Morepen Labs. Q2 FY27 Results (NSE: MOREPENLAB)
Signal: Growth reaccelerated
The read
The trajectory has inflected from the Q4FY26 and Q1FY27 margin weakness: consolidated EBITDA margin expanded to approximately 17.7% from 8.6% YoY and 13.0% QoQ, with gross margin up 1210bps YoY, while revenue growth accelerated to 81.4% from 34.1% in Q1FY27; the key unresolved question is whether the gross-margin recovery is durable because the filing does not disclose its driver.
| Metric | Value | YoY | QoQ |
|---|---|---|---|
| Revenue | ₹746.5 Cr | 81.4% | 30.9% |
| Net profit | ₹88.89 Cr | 117.5% | |
| EPS | ₹1.62 | 116.0% | |
| EBIT margin | 17.7% |
P&L walk
Consolidated revenue increased to ₹74650.19 lakh, +81.4% YoY and +30.9% QoQ, while gross margin expanded to 47.9% from 35.8% YoY and EBITDA margin rose to 17.7% from approximately 8.6%; PAT reached ₹8889.47 lakh, +117.5% YoY, supported by operating profit rather than exceptional income.
Segments
The consolidated group added ₹26511.37 lakh of subsidiary revenue and ₹1101.86 lakh of subsidiary profit before consolidation adjustments; standalone PAT of ₹7787.20 lakh was 87.6% of consolidated PAT of ₹8889.47 lakh, so subsidiaries lifted but did not dominate group earnings.
Key positives
- Consolidated revenue reached ₹74650.19 lakh, +81.4% YoY and +30.9% QoQ, a sharp acceleration from Q1FY27 revenue growth of 34.1% YoY.
- Gross margin expanded 1210bps YoY to 47.9%, while raw-material and related production costs fell to 52.1% of revenue from 64.2%; this drove EBITDA margin to approximately 17.7%.
- EBITDA grew approximately 273.2% YoY versus revenue growth of 81.4%, a +191.8pp growth gap; employee costs grew 40.6% YoY and depreciation fell 10.7%, supporting the margin expansion.
- PAT rose 117.5% YoY to ₹8889.47 lakh and EPS rose 116.0% to ₹1.62, showing no material PAT-to-EPS divergence.
- A favourable High Court order removed the ₹317.37 crore contingent liability relating to the GST and excise matter disclosed at 31.03.2026.
Key concerns
- Gross-margin expansion of 1210bps YoY is not attributed by management in the filing, so its persistence is not yet established.
- Selling and distribution expense increased 464.6% YoY to ₹7830.16 lakh, rising to 10.5% of revenue from 3.4% a year ago.
- Consolidated finance cost rose 24.2% YoY to ₹519.24 lakh even as depreciation declined 10.7% YoY, while the asset base expanded 10.3% from March.
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