PNGS Reva Diamo. Q2 FY27 Results (NSE: PNGSREVA)

26 Oct 2026 · Analysis by Alpha Inflection

Signal: Margin expansion

The read

The key inflection is margin rather than demand: Q2 revenue grew only 17.1% YoY and 2.2% QoQ after Q1FY27's 119.5% YoY growth, but gross margin expanded 690bps YoY to 31.1% and operating margin rose 517bps to 23.8%; the improvement is encouraging but the filing does not identify the mix or input-cost driver and needs confirmation as growth reaccelerates.

P&L walk

Standalone revenue grew 17.1% YoY to ₹1,205.41 million but only 2.2% QoQ, while gross margin expanded 690bps YoY to 31.1% and PAT rose 84.7% to ₹232.94 million; the quarter's margin gain was primarily driven by lower raw-material intensity, whereas growth momentum decelerated from Q1FY27.

Key positives

• Gross margin expanded 690bps YoY to 31.1% as raw-material cost fell to 68.9% of revenue from 75.8%; the filing does not disclose whether this was pricing, mix or input-cost driven.
• Operating EBITDA increased 49.5% YoY to an implied ₹287.14 million versus 17.1% revenue growth, lifting operating margin 517bps to 23.8%.
• The store network reached 34 SIS stores and 5 exclusive brand stores as of October 26, 2026, versus 2 exclusive brand stores at March 31, 2026.
• H1 operating cash flow was ₹751.97 million, while unutilised IPO proceeds of ₹2,836.00 million remained temporarily invested in fixed deposits.

Key concerns

• Revenue growth decelerated to 17.1% YoY in Q2FY27 from 119.5% in Q1FY27 and was only 2.2% sequentially.
• Employee plus other expenses increased 47.1% YoY to ₹87.18 million, faster than revenue growth of 17.1%.
• Basic EPS growth of 44.1% materially lagged PAT growth of 84.7% because paid-up capital rose to ₹316.91 million from ₹211.66 million.
• The filing does not explain the 690bps gross-margin expansion, so the durability of the margin improvement remains unconfirmed.

View original filing

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