HP Adhesives Q1 FY27 Results (NSE: HPAL)
Signal: Slipped to loss
The read
The key inflection remains negative: after the fire-related Q4FY26 loss of ₹237.27 lakh, Q1FY27 revenue recovered 9.7% QoQ but gross margin compressed 229bps YoY and EBITDA margin fell to 1.2%, leaving the group with a ₹90.55 lakh loss; the cost structure has not yet normalised.
| Metric | Value | YoY | QoQ |
|---|---|---|---|
| Revenue | ₹63.42 Cr | -4.1% | +9.7% |
| EBIT | ₹-0.55 Cr | N/A | |
| Net profit | ₹-0.91 Cr | N/A | |
| EPS | ₹-0.1 | N/A | |
| EBIT margin | 1.2% |
P&L walk
Consolidated revenue declined 4.1% YoY to ₹6,341.65 lakh, gross margin compressed 229bps as material costs rose to 66.4% of revenue, EBITDA fell 90.4% to ₹73.00 lakh and PAT moved to a ₹90.55 lakh loss.
Segments
The single adhesives and sealants business has no reported segment split; the subsidiary contributed ₹34.05 lakh of revenue and a ₹6.95 lakh loss, widening the consolidated loss to ₹90.55 lakh versus the standalone loss of ₹83.64 lakh.
Key positives
- Revenue recovered 9.7% QoQ to ₹6,341.65 lakh from ₹5,782.07 lakh, although it remained 4.1% below the year-ago quarter.
- The consolidated loss narrowed to ₹90.55 lakh from ₹237.27 lakh in Q4FY26, a 61.8% sequential improvement.
- Depreciation declined 9.7% YoY to ₹127.38 lakh, reducing the fixed-charge burden despite the weak operating result.
Key concerns
- Gross margin compressed 229bps YoY to 33.6% as material and traded-goods costs rose to 66.4% of revenue from 57.0%; the filing does not disclose the cause.
- EBITDA fell 90.4% YoY to ₹73.00 lakh and EBITDA margin contracted to 1.2% from the year-ago level, indicating severe profitability pressure.
- Other expenses increased 53.3% YoY to ₹1,186.39 lakh while revenue declined 4.1%, intensifying cost absorption.
- Finance costs rose 24.9% YoY to ₹80.52 lakh despite lower revenue.
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