IZMO Q4 FY26 Results (NSE: IZMO)
Signal: Margin pressure
The read
Q4 consolidated revenue surged 81.7% YoY to ₹109 Cr, the highest in the PRIOR RESULTS SERIES, likely from a large deal or full consolidation of subsidiaries. However, OPM contracted 500bps to 14% — the third consecutive quarter of margin contraction for the group. PAT grew 149.7% YoY, but on a low base. Standalone remains a loss-making holding entity with a negative operating cash flow of ₹32 Cr for FY26. The auditor's emphasis-of-matter on tax disputes adds an overhang.
| Metric | Value | YoY | QoQ |
|---|---|---|---|
| Revenue | ₹109 Cr | 81.7% | 84.7% |
| EBIT | ₹15 Cr | 87.5% | |
| Net profit | ₹17 Cr | 151.09% | |
| EPS | ₹11.56 | 149.7% | |
| EBIT margin | 14% |
P&L walk
Consolidated revenue jumped 81.7% YoY to ₹109 Cr, but OPM contracted 500bps to 14% as cost growth outpaced revenue; PAT grew 149.7% YoY to ₹17 Cr driven by the revenue surge and low base.
Segments
The consolidated result is driven entirely by subsidiaries; standalone revenue is only ₹8.66 Cr vs consolidated ₹109.16 Cr, indicating the group's earnings are generated from overseas subsidiaries.
Key positives
- Consolidated Q4 revenue of ₹109 Cr, +81.7% YoY, the highest ever quarterly revenue in the 12-quarter series.
- Consolidated Q4 PAT of ₹17 Cr, +149.7% YoY, the highest PAT in the series.
- Consolidated FY26 PAT of ₹239.24 lakh (standalone standalone FY PAT was only ₹40.93 lakh) shows group profitability driven by overseas subsidiaries.
Key concerns
- Consolidated OPM fell 500bps YoY to 14% in Q4 — third consecutive quarter of margin contraction — signaling structural cost pressures or one-time integration costs.
- Consolidated Q4 PAT growth of 149.7% is on a low prior-year base (Q4FY25 PAT ₹7 Cr); absolute PAT of ₹17 Cr is modest for a ₹109 Cr revenue base.
- Standalone entity reported a net loss of ₹40.33 lakh in Q4 as employee costs (96.4% of revenue) and other expenses soared.
- FY26 standalone net cash from operations was deeply negative at (₹3,200.15) lakh vs (₹540.18) lakh in FY25, driven by a massive increase in trade receivables/other assets — a potential earnings quality concern.
- The auditor's report carries an 'Emphasis of Matter' regarding pending tax disputes with Indian regulatory authorities — outcome uncertain.
Research and educational content only. Not investment advice.