Indokem Q2 FY27 Results (NSE: INDOKEM)
Signal: Growth reaccelerated
The read
The trajectory is mixed: consolidated revenue recovered to ₹4,764 lakh, +16.7% YoY after two quarters of decline, and derived EBITDA margin improved to 3.6% from 3.0%, but gross margin compressed 323bps to 31.4%, finance cost rose 33.3%, and subsidiary losses reduced PAT growth to 4.9%; sequentially, EBITDA margin fell 72bps and PAT fell 59.8%.
| Metric | Value | YoY | QoQ |
|---|---|---|---|
| Revenue | ₹47.64 Cr | +16.7% | +1.5% |
| Net profit | ₹0.43 Cr | +4.9% | |
| EPS | ₹0.15 | 0.0% |
P&L walk
Revenue increased to ₹4,764 lakh, +16.7% YoY and +1.5% QoQ, but gross margin fell to 31.4% from 34.6% YoY, while EBITDA margin improved to 3.6% from 3.0%; finance cost rose 33.3% YoY and PAT growth was limited to 4.9% by subsidiary losses.
Segments
The consolidated group materially underperformed the parent: consolidated PAT was ₹43 lakh versus standalone PAT of ₹75 lakh, with one subsidiary reporting a ₹25.27 lakh quarterly loss and two smaller subsidiaries reporting combined losses of ₹3.70 lakh.
Key positives
- Consolidated revenue reached ₹4,764 lakh, up 16.7% YoY and 1.5% QoQ, reversing the prior two-quarter YoY contraction in the results series.
- Derived consolidated EBITDA rose 40.5% YoY to ₹170 lakh versus revenue growth of 16.7%, with employee plus other expenditure up only 3.9% YoY; EBITDA margin expanded 61bps to 3.6%.
- Standalone PAT increased 13.6% YoY to ₹75 lakh, while standalone EPS rose 12.5% to ₹0.27.
Key concerns
- Consolidated PAT rose only 4.9% YoY to ₹43 lakh despite 16.7% revenue growth because subsidiaries reported losses, including a ₹25.27 lakh quarterly loss at one subsidiary.
- Gross margin compressed 323bps YoY to 31.4%; raw-material cost remained broadly stable at 65.1% of revenue versus 64.9% YoY, so the filing does not establish pricing or mix protection.
- Consolidated finance cost increased 33.3% YoY to ₹104 lakh and 26.8% QoQ, limiting conversion of operating improvement into PAT.
- Operating cash flow was negative at ₹221 lakh in H1FY27 while trade receivables rose to ₹4,523 lakh and inventories to ₹3,607 lakh.
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