GRP Q2 FY27 Results (NSE: GRPLTD)
Signal: Margin expansion
The read
The inflection is a second consecutive quarter of YoY operating-margin expansion: consolidated operating margin rose 196bps YoY to 10.57% after Q1FY27's 276bps recovery, while revenue growth accelerated to 30.2%; however, the 50bps sequential margin decline and higher borrowings mean the recovery is not yet fully established.
| Metric | Value | YoY | QoQ |
|---|---|---|---|
| Revenue | ₹172.34 Cr | +30.2% | +9.9% |
| EBIT | ₹13.02 Cr | +89.9% | |
| Net profit | ₹6.38 Cr | +225.5% | |
| EPS | ₹11.96 | +226.0% | |
| EBIT margin | 10.57% |
P&L walk
Revenue accelerated to ₹17,233.55 lakh, +30.2% YoY and +9.9% QoQ, while EBITDA-style operating margin recovered to 10.57% from 8.61% YoY but eased from 11.07% QoQ; PAT rose to ₹637.64 lakh from ₹195.89 lakh as operating profit improved and other income remained modest.
Segments
Rubber Recycling remains the earnings engine, contributing ₹15,703.95 lakh of revenue and ₹1,864.35 lakh of segment result; Others grew faster at 30.0% YoY but contributed only ₹330.62 lakh of result.
Key positives
- Consolidated revenue reached ₹17,233.55 lakh, up 30.2% YoY and 9.9% QoQ, reversing the weak growth profile seen in the immediately preceding quarters.
- Operating margin expanded 196bps YoY to 10.57%, the second consecutive quarter of YoY margin expansion in the available series.
- Employee costs rose only 2.9% YoY to ₹1,641.58 lakh against 30.2% revenue growth, supporting margin recovery.
- Rubber Recycling segment result increased 40.7% YoY to ₹1,864.35 lakh, materially faster than segment revenue growth of 21.5%.
Key concerns
- Operating margin declined 50bps QoQ to 10.57% from 11.07%, so the recovery remains volatile rather than a straight-line improvement.
- Finance costs increased 17.6% YoY to ₹415.76 lakh as borrowings rose to ₹21,908.25 lakh, limiting conversion of operating gains into PAT.
- H1 operating cash flow of ₹1,733.58 lakh was slightly below ₹1,771.33 lakh last year despite H1 PAT rising to ₹1,057.48 lakh from ₹370.69 lakh, reflecting working-capital absorption.
Research and educational content only. Not investment advice.