Morepen Labs. Q1 FY27 Results (NSE: MOREPENLAB)
Signal: Margin expansion
The read
Q1FY27 marks a sharp inflection: revenue growth accelerated to +34% YoY after four quarters of sub-10% growth, gross margin expanded ~580bps on raw material tailwind, and EBITDA margin more than doubled to 15.4% — the highest in at least five quarters. PAT of ₹56.4 Cr (+425% YoY) was driven entirely by operations, with clean earnings quality. The CDMO mandate commercial execution appears to be the catalyst. However, selling & distribution expenses surged 75% YoY, warranting monitoring.
| Metric | Value | YoY | QoQ |
|---|---|---|---|
| Revenue | ₹570.13 Cr | 34.1% | 17.6% |
| EBIT | ₹79.37 Cr | 305.9% | |
| Net profit | ₹56.4 Cr | 424.8% | |
| EPS | ₹1.03 | 415.0% | |
| EBIT margin | 15.4% |
P&L walk
Consolidated P&L: revenue grew 34% YoY to ₹570 Cr, reversing the recent deceleration trend; gross margin expanded ~580bps to 44.1% as raw material cost fell from 61.7% to 55.9% of revenue (input deflation/mix benefit); EBITDA margin surged to 15.4% (+867bps) on the gross margin tailwind and modest opex growth; PAT after minority jumped 425% to ₹56.4 Cr, with EPS at ₹1.03 (+415%).
Key positives
- Revenue grew 34% YoY to ₹570 Cr, reversing a deceleration trend (last 4 quarters had <10% YoY growth).
- EBITDA margin expanded 867bps YoY to 15.4%, the highest in 5 quarters, driven by raw material cost deflation (RM % fell from 61.7% to 55.9%).
- Net profit after minority jumped 425% YoY to ₹56.4 Cr, with EPS at ₹1.03 (+415%).
- No exceptional items or tax write-backs; earnings quality clean (other income <20% of PBT).
Key concerns
- Selling & distribution expenses grew 75% YoY (to ₹53.3 Cr), far outpacing revenue growth of 34% — may pressure margins if not stabilised.
- The revenue and margin surge partly reflects a low base (year-ago OPM was just 6.7%); sustainability needs confirmation in coming quarters.
Research and educational content only. Not investment advice.