Godrej Consumer Q1 FY27 Results (NSE: GODREJCP)
Signal: Growth reaccelerated
The read
The quarter marks a revenue-growth acceleration to 18.3% YoY, led by Africa's 47.1% growth, but the thesis remains margin-sensitive: consolidated gross margin contracted 261bps and operating margin fell 40bps to 19.0%, so PAT growth of 11.5% lagged sales despite employee costs rising only 3.3%.
| Metric | Value | YoY | QoQ |
|---|---|---|---|
| Revenue | ₹4,225.47 Cr | +18.3% | +8.3% |
| EBIT | ₹778.07 Cr | +8.1% | |
| Net profit | ₹504.52 Cr | +11.5% | |
| EPS | ₹4.93 | +11.5% | |
| EBIT margin | 19.0% |
P&L walk
Revenue increased 18.3% YoY to ₹4,225.47 crore, but gross margin fell to 48.1% from 50.7% and operating margin declined to 19.0% from 19.4%; lower other income and exceptional charges moderated PAT growth to 11.5%.
Segments
Africa was the clear growth engine, with revenue up 47.1% YoY to ₹1,006.13 crore and segment result up 40.1% to ₹102.69 crore; India remained the largest profit pool at ₹528.21 crore but its result declined 0.7% YoY, while Indonesia result increased 10.6%.
Key positives
- Consolidated revenue reached ₹4,225.47 crore, up 18.3% YoY and 8.3% QoQ, accelerating from +11.0% YoY in Q4FY26.
- Africa revenue grew 47.1% YoY to ₹1,006.13 crore and segment result grew 40.1% to ₹102.69 crore, making it the main consolidated growth driver.
- Employee benefits expense rose only 3.3% YoY to ₹319.31 crore against 18.3% revenue growth, supporting cost discipline even though the margin outcome was negative.
- EPS rose 11.5% YoY to ₹4.93 in line with PAT, with no evidence of material equity dilution in the quarter.
- The board declared an interim dividend of ₹5 per share, payable on or before September 5, 2026.
Key concerns
- Consolidated gross margin fell 261bps YoY to 48.1% as purchase of stock-in-trade rose 89.8% YoY to ₹650.01 crore; raw-material cost was 40.9% of revenue versus 41.5% YoY, so the main pressure was not raw-material inflation alone.
- Operating margin declined 40bps YoY to 19.0% despite revenue growth of 18.3%; the company appears to have retained only partial benefit from scale because higher stock-in-trade costs and mix effects absorbed the benefit of slower employee-cost growth.
- Standalone PAT grew only 2.3% YoY to ₹362.72 crore versus 9.6% revenue growth, as standalone other income fell to ₹29.40 crore from ₹65.32 crore.
- Indonesia segment result declined 20.8% QoQ to ₹117.57 crore even though revenue was broadly flat QoQ, warranting monitoring of regional profitability.
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