GK Energy Q1 FY27 Results (NSE: GKENERGY)
Signal: Growth reaccelerated
The read
The quarter delivered ₹5,051.92 million revenue, +55.5% YoY, and ₹596.49 million PAT, +59.9%, but the trajectory weakened at the gross-profit level: cost of goods sold rose +103.0% and gross margin compressed 1,685bps to 27.82%, pulling EBITDA margin down 74bps to 16.84%; the recent margin expansion seen in Q3FY26 has not been sustained.
| Metric | Value | YoY | QoQ |
|---|---|---|---|
| Revenue | ₹505.19 Cr | +55.5% | +6.0% |
| Net profit | ₹59.65 Cr | +59.9% | |
| EPS | ₹2.94 | +34.2% | |
| EBIT margin | 16.84% |
P&L walk
Revenue grew to ₹5,051.92 million, +55.5% YoY and +6.0% QoQ, but cost of goods sold rose +103.0% YoY and compressed gross margin to 27.82%; EBITDA margin consequently fell to 16.84%, while PAT still rose +59.9% to ₹596.49 million on higher operating profit and a stable effective tax rate.
Segments
The EPC business generated the entire reported ₹5,051.92 million revenue and ₹849.95 million segment result, while Trading of Solar Cells and Others contributed ₹0 revenue and ₹0 segment result in the quarter; the subsidiary's ₹0.20 million loss was immaterial.
Key positives
- Consolidated revenue reached ₹5,051.92 million, +55.5% YoY and +6.0% QoQ, extending the business's strong revenue scale-up from ₹3,247.86 million in Q1FY26.
- PAT increased +59.9% YoY to ₹596.49 million, with PBT up to ₹802.58 million and finance cost still only ₹12.65 million.
- Employee costs rose +51.5% YoY to ₹432.49 million, slower than revenue growth of +55.5%, providing some cost absorption despite gross-margin pressure.
- The Board recommended a final dividend of ₹0.50 per equity share for FY26, subject to shareholder approval.
Key concerns
- Gross margin fell 1,685bps YoY to 27.82% as cost of goods sold increased +103.0% to ₹3,646.21 million and rose to 72.18% of revenue from 55.33%; the filing does not disclose the driver.
- EBITDA margin declined 74bps YoY to 16.84% because derived EBITDA growth of approximately +49.0% trailed revenue growth of +55.5%.
- EPS growth of +34.2% lagged PAT growth of +59.9%, consistent with the paid-up equity share capital increase to ₹405.63 million from ₹340.28 million.
- Total segment assets increased to ₹14,957.55 million from ₹8,371.77 million while depreciation remained flat at ₹69.62 million, requiring monitoring of asset commissioning and depreciation adequacy.
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