Mangalam World. Q1 FY27 Results (NSE: MWL)
Signal: Growth reaccelerated
The read
Q1FY27 marks a sharp reversal from the prior margin expansion trend — raw material costs surged to 85.9% of revenue (+1,310bps YoY), compressing OPM to 2.3% despite 19.4% revenue growth. PAT fell 23.6% YoY, the first YoY profit decline in at least 10 quarters. The company may be absorbing input cost inflation (stainless steel scrap/ferro alloys) without full pass-through, and higher debt costs (finance cost +34.5%) add pressure. This is a cyclical earnings trough signal in a commodity business that had enjoyed 63% PAT CAGR over 3 years.
| Metric | Value | YoY | QoQ |
|---|---|---|---|
| Revenue | ₹316.22 Cr | 19.4% | 14.7% |
| EBIT | ₹12.37 Cr | -24.5% | |
| Net profit | ₹11.76 Cr | -23.6% | |
| EPS | ₹3.96 | -23.6% | |
| EBIT margin | 2.3% |
P&L walk
No consolidated figures in this filing — standalone only; standalone PAT declined 23.6% YoY despite 19.4% revenue growth, driven by a 1,310bps surge in raw material cost-to-sales to 85.9%.
Key positives
- Revenue grew 19.4% YoY to ₹31,622 lakh, continuing double-digit top-line momentum for 8th consecutive quarter.
- Employee cost grew at only 13.5% YoY vs 19.4% revenue growth, demonstrating partial operating leverage on manpower.
Key concerns
- Raw material cost as % of revenue surged 1,310bps YoY to 85.9%, crushing gross margin — input cost pass-through appears incomplete.
- OPM fell to 2.3% from 3.1% a year ago and 10.0% in Q4FY26, reversing a 3-quarter streak of margin expansion.
- Finance cost rose 34.5% YoY and 86.8% QoQ, reflecting higher leverage (debt-equity 1.14x vs 0.81x in Q4FY26).
- PAT declined 23.6% YoY — first YoY profit drop since at least Q1FY24 — signalling cyclical compression.
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