Nureca Q2 FY27 Results (NSE: NURECA)
Signal: Margin expansion
The read
The trajectory improved for a second consecutive quarter: revenue accelerated to ₹585.26 million, EBITDA grew 101.0% and margin expanded 257bps to 11.24%, but gross margin compressed 309bps and H1 operating cash flow turned negative at ₹125.38 million as inventory and receivables absorbed cash.
| Metric | Value | YoY | QoQ |
|---|---|---|---|
| Revenue | ₹58.53 Cr | +55.1% | +45.1% |
| Net profit | ₹4.05 Cr | +11.7% | |
| EPS | ₹4.25 | +17.1% | |
| EBIT margin | 11.24% |
P&L walk
Revenue rose 55.1% YoY to ₹585.26 million and EBITDA margin expanded 257bps to 11.24%, supported by employee-cost intensity falling to 7.02%, but gross margin compressed 309bps and PAT growth was limited to 11.7% by higher tax and weaker other income.
Segments
The group has a single reportable segment, Home healthcare and wellness products; consolidated PAT of ₹40.51 million exceeded standalone PAT of ₹36.22 million by ₹4.29 million, showing a positive subsidiary contribution.
Key positives
- Revenue reached ₹585.26 million, up 55.1% YoY and 45.1% QoQ, accelerating from ₹377.40 million in Q2FY26.
- Derived EBITDA grew 101.0% YoY to ₹65.80 million versus revenue growth of 55.1%, while EBITDA margin expanded 257bps to 11.24%.
- Employee benefits expense increased only 1.7% YoY to ₹41.11 million, reducing employee-cost intensity to 7.02% of revenue from 10.05%.
- H1 PAT rose 60.4% YoY to ₹71.18 million and H1 EPS rose 68.0% to ₹7.46.
Key concerns
- Gross margin compressed 309bps YoY to 33.81% despite revenue growth of 55.1%; the filing does not disclose the reason.
- H1 operating cash flow was negative ₹125.38 million versus positive ₹44.46 million a year earlier, as inventories increased to ₹629.87 million and trade receivables to ₹271.06 million.
- Other income declined 41.6% YoY to ₹13.53 million, limiting PAT growth to 11.7% despite 101.0% EBITDA growth.
- Purchase of stock-in-trade rose to ₹521.74 million, or 89.15% of quarterly revenue, while the quarter recorded a ₹195.78 million inventory reduction; earnings remain sensitive to inventory timing.
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