Rajratan Global Q1 FY27 Results (NSE: RAJRATAN)
Signal: Margin pressure
The read
Q1FY27 consolidated revenue growth accelerated to 29.1% YoY, the fastest in the last 5 quarters, driven by a sharp ramp-up in export/subsidiary sales (+44.7%). However, operating margin compressed for the 5th time in 6 quarters (OPM 9.5%, -150bps YoY) as raw material cost outpaced revenue. PAT growth (70%) was inflated by other income (₹3.4 Cr vs ₹1 C r YoY) — excluding that, operating PAT growth was ~37%. The margin story remains the key concern; the QoQ revenue acceleration is a positive but needs margin stabilisation to sustain re-rating.
| Metric | Value | YoY | QoQ |
|---|---|---|---|
| Revenue | ₹318.35 Cr | 29.1% | 1.3% |
| EBIT | ₹30.15 Cr | 70.1% | |
| Net profit | ₹22.96 Cr | 69.8% | |
| EPS | ₹4.52 | 69.9% | |
| EBIT margin | 9.5% |
P&L walk
Revenue jumped 29% YoY on strong domestic and export demand, but gross margin compressed 340bps as raw material cost rose faster than revenue; EBITDA margin fell 150bps YoY. PAT surged 70% YoY, aided by higher other income (+227% YoY) and lower finance cost (-10% YoY) — the operating quality remains subdued.
Segments
Rest of World revenue surged 44.7% YoY (₹14,473 lakh vs ₹10,100 lakh), outpacing India's 19.3% growth — exports/ subsidiaries (Thailand & USA) are the primary growth engine, contributing ~45% of group revenue.
Key positives
- Consolidated revenue grew 29.1% YoY to ₹318 Cr, accelerating sharply from +25.1% in Q4FY26.
- Rest of World segment revenue surged 44.7% YoY (₹144.7 Cr vs ₹101.0 Cr), driving overall growth.
- PAT grew 69.8% YoY to ₹23 Cr, boosted by higher other income and lower finance costs.
- Employee cost ratio improved 60bps YoY to 4.8% — operating efficiency in fixed costs.
- Finance cost declined 10% YoY despite higher revenue, signalling better debt management.
Key concerns
- OPM contracted 150bps YoY to 9.5% — 5th quarter of compression in the last 6, reflecting persistent input cost pressure.
- Cost of materials as % of revenue rose 340bps YoY to 66.5% — raw material inflation outpaced revenue growth.
- PAT growth was distorted by other income (₹3.4 Cr, +227% YoY) — quality of earnings weaker than headline suggests.
- Standalone OPM fell 250bps YoY to 9.6%, worse than consolidated — domestic margin drag more acute.
Research and educational content only. Not investment advice.