Kellton Tech Q1 FY27 Results (NSE: KELLTONTEC)
Signal: Steady quarter
The read
Q1FY27 showed modest revenue growth but margin contraction YoY, with PAT flat to slightly down. The sequential margin improvement from Q4 is encouraging, but the YoY decline in EBIT margin (down 86bps) and EPS dilution remain concerns. The standalone entity is weak; consolidated results depend on subsidiaries. The recent joint venture with Action Energy Company (July 6, 2026) is not yet reflected in these numbers.
| Metric | Value | YoY | QoQ |
|---|---|---|---|
| Revenue | ₹315.62 Cr | 6.82% | 0.55% |
| EBIT | ₹31.24 Cr | -1.72% | |
| Net profit | ₹22.32 Cr | -1.47% | |
| EPS | ₹0.42 | -8.7% | |
| EBIT margin | 9.9% |
P&L walk
Revenue grew 6.8% YoY, but EBIT margin contracted 86bps YoY to 9.9% as employee cost and other expenses grew faster than revenue. PAT declined 1.5% due to lower operating profit and higher finance cost. EPS fell 8.7% on dilution from equity issuance.
Segments
Digital Transformation segment (84% of revenue) grew 8.1% YoY and contributed 89% of segment EBITDA, driving consolidated growth. Consulting revenue declined 5.6% YoY, dragging overall mix. Enterprise Solutions grew modestly at 2%. Consolidated profit far exceeds standalone, indicating the bulk of earnings is generated in subsidiaries.
Key positives
- Sequential EBIT margin expanded 138bps QoQ to 9.9%, recovering from Q4's 8.5% low.
- Digital Transformation segment revenue grew 8.1% YoY, maintaining momentum.
- Consolidated net profit improved 14.4% QoQ to ₹22.32 Cr.
Key concerns
- EBIT margin contracted 86bps YoY, with employee cost growing faster than revenue (9% vs 6.8%).
- EPS declined 8.7% YoY due to dilution from equity issuance (share count up 9% YoY).
- Consulting revenue declined 5.6% YoY, indicating weakness in that vertical.
- Standalone operating profit fell sharply, highlighting dependence on subsidiaries for earnings.
Research and educational content only. Not investment advice.