Redington Q2 FY27 Results (NSE: REDINGTON)
Signal: Growth reaccelerated
The read
The trajectory is revenue acceleration rather than margin expansion: consolidated revenue grew 47.7% YoY to ₹42,946.91 Cr, led by SISA's 65.5% growth, but EBITDA margin contracted 10bps to 2.08% and operating cash flow turned negative at ₹2,571.17 Cr in H1FY27. Shareholder PAT rose 39.6% to ₹541.32 Cr and EPS tracked it, but the ₹80.33 Cr Arena impairment and negative non-controlling interest make earnings quality and ROW profitability the key watchpoints.
| Metric | Value | YoY | QoQ |
|---|---|---|---|
| Revenue | ₹42,946.91 Cr | +47.7% | +23.0% |
| EBIT | ₹832.26 Cr | +43.1% | |
| Net profit | ₹541.32 Cr | +39.6% | |
| EPS | ₹6.92 | +39.5% | |
| EBIT margin | 2.08% |
P&L walk
Revenue accelerated to ₹42,946.91 Cr, +47.7% YoY and +23.0% QoQ, while gross margin slipped to 4.76% from 4.99% and EBITDA margin to 2.08% from 2.18%; EBIT still grew 43.1% to ₹832.26 Cr, but PAT attributable to shareholders was supported by the absence of last year's comparable base and remained affected by a ₹80.33 Cr Arena impairment.
Segments
SISA drove the quarter: revenue grew 65.5% YoY to ₹25,632.10 Cr and segment result rose 67.0% to ₹585.93 Cr, while ROW revenue grew 27.4% to ₹17,328.90 Cr and result increased only 9.4% to ₹246.33 Cr.
Key positives
- Consolidated revenue reached ₹42,946.91 Cr, up 47.7% YoY and 23.0% QoQ, accelerating from 34.6% YoY revenue growth in Q1FY27.
- SISA revenue grew 65.5% YoY to ₹25,632.10 Cr and SISA segment result grew 67.0% to ₹585.93 Cr, making it the primary growth engine.
- Shareholder PAT grew 39.6% to ₹541.32 Cr and EPS rose 39.5% to ₹6.92, showing no material PAT-to-EPS dilution in the quarter.
- Employee and other operating expenses grew 39.8% YoY to ₹1,206.70 Cr, below revenue growth of 47.7%, providing partial operating cost absorption despite lower gross margin.
Key concerns
- Consolidated EBITDA margin declined 10bps YoY to 2.08% and gross margin declined 23bps to 4.76%, so the sharp revenue growth is not yet translating into margin expansion.
- Consolidated operating cash flow was negative ₹2,571.17 Cr in H1FY27 versus positive ₹737.48 Cr a year ago, with trade receivables and inventories absorbing cash.
- ROW segment result grew only 9.4% YoY to ₹246.33 Cr against 27.4% revenue growth, indicating weaker profit conversion outside SISA.
- Standalone PAT of ₹838.64 Cr materially exceeded consolidated shareholder PAT of ₹541.32 Cr, while ₹493.38 Cr of standalone other income included dividend income; reported parent earnings are therefore not representative of group operating earnings.
Research and educational content only. Not investment advice.