Kesoram Inds. Q1 FY27 Results (NSE: KESORAMIND)
Signal: Loss narrowed
The read
Revenue growth (+27.2% YoY) is positive but overshadowed by a sharp EBITDA margin deterioration to -12% from -7.1% a year ago, driven by a 1,750bps spike in raw material cost as a percentage of revenue. The net loss narrowed drastically solely due to the absence of prior-year exceptional impairment charges; underlying operating loss deepened, indicating the business remains under severe cost and demand pressure. The going-concern note and change in control (SPA) add uncertainty.
| Metric | Value | YoY | QoQ |
|---|---|---|---|
| Revenue | ₹0.78 Cr | 27.2% | -68.6% |
| EBIT | ₹-0.14 Cr | -283.1% | |
| Net profit | ₹-0.2 Cr | 79.7% | |
| EPS | ₹-0.65 | 79.7% | |
| EBIT margin | -12% |
P&L walk
Revenue grew 27.2% YoY to ₹77.66 Cr, but EBITDA margin worsened from -7.1% to -12% as cost of materials consumed surged to 69.6% of revenue (vs 52.1% a year ago). Net loss narrowed to -₹20.19 Cr from -₹99.34 Cr in Q1FY26 largely due to absence of prior-year exceptional impairment of ₹89.81 Cr. PAT improvement is entirely one-off; operating losses deepened.
Segments
The single segment (Rayon, Transparent Paper and Chemicals) reported segment loss (PBIT) of -₹20.63 Cr vs -₹9.62 Cr in Q1FY26, reflecting operational deterioration.
Key positives
- Consolidated revenue grew 27.2% YoY to ₹77.66 Cr, driven by higher sales volumes.
- Net loss narrowed by 79.7% YoY to -₹20.19 Cr, aided by absence of prior-year exceptional impairment of ₹89.81 Cr.
- Employee cost as % of revenue improved by 400bps YoY to 23.0%, indicating some fixed cost absorption.
Key concerns
- EBITDA loss widened to -₹9.29 Cr vs -₹1.29 Cr in Q1FY26; EBITDA margin fell to -12% from -7.1%.
- Cost of materials consumed surged to 69.6% of revenue from 52.1% YoY, compressing gross margin by ~1,950bps.
- Power and fuel costs remained elevated at ₹9.72 Cr (12.5% of revenue).
- Finance costs rose 10.8% YoY and 28.0% QoQ, indicating higher debt servicing burden.
- Going concern basis adopted; change in control (SPA) yet to complete, adding uncertainty.
- Operating loss before exceptional items deepened to -₹20.63 Cr from -₹9.62 Cr YoY.
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