Rane Holdings Q1 FY27 Results (NSE: RANEHOLDIN)
Signal: Earnings declined
The read
The operating inflection is negative: revenue grew 18.35% YoY, but gross margin compressed 280bps to 32.29% as material-related costs rose to 67.71% of revenue, pulling derived EBITDA margin down 58bps to 7.38%; PAT fell 16.04% because last year's ₹1,546 lakh exceptional benefit was not repeated and current tax rose to ₹1,180 lakh from ₹569 lakh.
| Metric | Value | YoY | QoQ |
|---|---|---|---|
| Revenue | ₹1,586.88 Cr | +18.35% | -1.35% |
| EBIT | ₹62.55 Cr | +11.05% | |
| Net profit | ₹48.27 Cr | -16.04% | |
| EPS | ₹26.17 | -26.43% | |
| EBIT margin | 7.38% |
P&L walk
Revenue increased to ₹1,58,688 lakh, +18.35% YoY and -1.35% QoQ, but gross margin fell to 32.29% from 35.09% as raw-material cost rose to 66.32% of revenue from 65.71%; operating EBIT rose 11.05% to ₹6,255 lakh, while PAT declined 16.04% to ₹4,827 lakh after lower exceptional income and higher tax.
Segments
The group reports one segment, with consolidated profit before tax of ₹6,058 lakh down 4.22% YoY despite revenue growth of 18.35%; the major divergence is basis-driven, as standalone PAT rose 39.94% to ₹953 lakh while consolidated PAT fell 16.04% to ₹4,827 lakh.
Key positives
- Consolidated revenue increased 18.35% YoY to ₹1,58,688 lakh, while employee benefits and other expenses grew 14.07%, slower than revenue.
- Finance costs declined 5.24% YoY to ₹2,007 lakh despite 18.35% revenue growth.
- Standalone PAT increased 39.94% YoY to ₹953 lakh, supported by a 51.85% decline in finance costs to ₹65 lakh.
- Segment assets increased 14.95% YoY to ₹4,23,139 lakh, while depreciation rose 8.36%, a clean depreciation-to-asset-base signal.
Key concerns
- Gross margin compressed 280bps YoY to 32.29% as material-related costs rose to 67.71% of revenue from 64.91%; revenue grew 18.35% while material consumption alone grew 19.40%, indicating cost absorption.
- Derived EBITDA margin declined 58bps YoY to 7.38%, with derived EBITDA growth of 9.78% trailing revenue growth by 8.57 percentage points.
- Consolidated PAT declined 16.04% YoY to ₹4,827 lakh despite 18.35% revenue growth, reflecting weaker earnings quality after exceptional income fell 83.83% to ₹250 lakh.
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