GRP Q1 FY26 Results (NSE: GRPLTD)
Signal: Growth reaccelerated
The read
Q1FY26 delivered a strong operational beat: revenue +30.5% YoY, EBITDA margin expanded 290bps YoY to 11.2% on clear operating leverage (employee cost +12.5%, other expenses +14.7% vs revenue +30.5%). PAT grew 48.1% YoY but was aided by a higher tax base last year; absolute PAT of ₹4.82 Cr is still well below the Q4FY25 run-rate of ₹19.45 Cr, highlighting sharp seasonality or lumpiness. The sequential collapse from Q4FY25 OPM of 20.5% to 8.3% in Q1FY26 (standalone) suggests Q4FY25 benefited from year-end factors (inventory/sales pull-forward). Key concern: D/E of 1.16x and finance cost rising 21.4% YoY weigh on leverage benefits.
| Metric | Value | YoY | QoQ |
|---|---|---|---|
| Revenue | ₹155.65 Cr | 30.5% | 8.9% |
| EBIT | ₹12.68 Cr | 120.6% | |
| Net profit | ₹4.82 Cr | 48.1% | |
| EPS | ₹9.04 | 48.2% |
P&L walk
Consolidated results not filed separately; standalone (group as reporting entity) used per segment note which consolidates subsidiaries.
Segments
Rubber Recycling segment drives the consolidated result: segment revenue grew 33.8% YoY to ₹15,439.13 lakh (gross), segment result (PBIT) jumped 71.1% YoY to ₹1,922.86 lakh, lifting the group; 'Others' segment revenue grew 6.6% but segment result was virtually flat (+4.0% YoY). Standalone figures equal consolidated as subsidiaries are consolidated via the 'Others' segment.
Key positives
- Revenue grew 30.5% YoY, accelerating from Q4FY25's +16.2% and Q3FY25's +20.6%.
- EBITDA (EBIT + D&A) grew 75.4% YoY, with EBITDA margin expanding 290bps YoY to 11.2% — clear operating leverage as employee cost grew only 12.5% and other expenses 14.7%.
- Rubber Recycling segment PBIT surged 71.1% YoY, indicating strong underlying business momentum.
Key concerns
- Sequential margin collapse: OPM dropped from 20.5% in Q4FY25 to 8.3% in Q1FY26, implying Q4 was exceptionally high and not a sustainable run-rate.
- Cost of materials as % of revenue rose to 55.0% from 49.9% in Q4FY25 (6-month high?), suggesting input cost pressure despite YoY improvement.
- Finance costs grew 21.4% YoY to ₹3.85 Cr, with D/E at 1.16x — elevated leverage limits net profit flow-through despite operating improvements.
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