Krishna Institu. Q1 FY27 Results (NSE: KIMS)
Signal: Margin pressure
The read
The key inflection is not revenue but earnings conversion: consolidated revenue accelerated to ₹11,795 million, +35.3% YoY, yet EBITDA margin fell 170bps to 20.3% and owner PAT declined 47.2% to ₹415 million; this is the fourth consecutive quarter of YoY margin contraction, while depreciation and finance costs rose 88.8% and 155.8% respectively. The standalone business remained stronger at 30.8% EBITDA margin and ₹665 million PAT, so the trajectory depends on subsidiary breakeven and whether the enlarged capital base funds profitable expansion rather than merely increasing financial and dilution drag.
| Metric | Value | YoY | QoQ |
|---|---|---|---|
| Revenue | ₹1,179.5 Cr | +35.3% | +9.8% |
| EBIT | ₹139 Cr | N/A | |
| Net profit | ₹41.5 Cr | -47.2% | |
| EPS | ₹1.04 | -46.9% | |
| EBIT margin | 20.3% |
P&L walk
Revenue grew to ₹11,795 million, +35.3% YoY and +9.8% QoQ, but EBITDA margin was 20.3%, down 170bps YoY; depreciation rose 88.8% YoY, finance costs rose 155.8% YoY and owner PAT fell 47.2% to ₹415 million.
Segments
The filing reports one segment, Medical and Healthcare services; the material divergence is basis-driven, with standalone PAT of ₹665 million versus consolidated owner PAT of ₹415 million because subsidiaries reported a combined ₹46 million net loss.
Key positives
- Consolidated revenue reached ₹11,795 million, +35.3% YoY and +9.8% QoQ, extending the company's high-growth expansion trajectory.
- Standalone EBITDA margin was 30.8% on ₹4,836 million revenue, 1,050bps above the consolidated 20.3%, showing the parent hospital operations remain materially more profitable than the group average.
- The company raised ₹15,000 million through the QIP, providing funding for stated expansion objects; unutilised proceeds were temporarily invested in mutual funds and held in a monitoring account.
- Associate contribution was ₹10 million of net profit in the quarter, partially offsetting subsidiary losses.
Key concerns
- Consolidated EBITDA margin declined 170bps YoY to 20.3%, continuing the margin contraction recorded over the recent four-quarter series despite revenue growth of 35.3%.
- Owner PAT fell 47.2% YoY to ₹415 million while revenue rose 35.3%, showing severe operating and below-EBITDA deleverage.
- Depreciation increased 88.8% YoY to ₹1,008 million and finance costs increased 155.8% to ₹834 million, sharply weakening EBITDA-to-PAT conversion.
- Subsidiaries reported a combined net loss of ₹46 million, explaining part of the ₹250 million gap between standalone PAT of ₹665 million and consolidated owner PAT of ₹415 million.
- The 19.87 million QIP shares issued at ₹755 and up to 7.70 million promoter-group warrants at ₹779 create further potential dilution; current EPS was ₹1.04 versus ₹1.96 YoY.
Earnings quality: includes non-operating other income
Research and educational content only. Not investment advice.