Prasol Chemicals Q2 FY27 Results (NSE: PRASOLCHEM)
Signal: Steady quarter
The read
The operating inflection is a 266bps YoY gross-margin expansion to 30.66% and 121.9% PAT growth on 38.7% revenue growth, but the near-term quality risk is cash conversion: H1 operating cash flow was negative 117.14 million as inventories rose to 3011.33 million and receivables to 3519.52 million.
| Metric | Value | YoY | QoQ |
|---|---|---|---|
| Revenue | ₹413.41 Cr | +38.7% | -4.7% |
| Net profit | ₹37.98 Cr | +121.9% | |
| EPS | ₹6.52 | +121.0% | |
| EBIT margin | N/A |
P&L walk
Standalone revenue from operations increased 38.7% YoY to 4134.08 million but declined 4.7% QoQ; gross margin expanded 266bps YoY to 30.66%, while PAT rose 121.9% YoY to 379.75 million, although H1 operating cash flow was negative at 117.14 million.
Key positives
- Revenue from operations rose 38.7% YoY to 4134.08 million, outpacing the 26.4% YoY increase in other expenses of 520.74 million.
- Gross margin expanded 266bps YoY to 30.66%; raw materials consumed increased to 62.22% of revenue from 58.98%, so the filing does not establish whether the margin benefit is sustainable or mix-led.
- PAT increased 121.9% YoY to 379.75 million and EPS rose 121.0% to ₹6.52, broadly tracking profit growth.
- Finance costs fell 20.1% YoY to 17.13 million, while net debt declined by 220.78 million from March 31, 2026.
Key concerns
- Revenue from operations declined 4.7% QoQ to 4134.08 million after 4336.46 million in the preceding quarter.
- H1 operating cash flow was negative 117.14 million versus positive 72.08 million in the comparable period, despite H1 PAT of 989.98 million.
- Inventory increased to 3011.33 million from 1532.38 million at March 31, 2026 and trade receivables rose to 3519.52 million from 2786.86 million, absorbing working capital.
- Gross margin compressed 768bps QoQ to 30.66%, while raw materials consumed rose to 62.22% of revenue from 50.85% in the preceding quarter.
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