Rhetan TMT Ltd Q1 FY27 Results (NSE: RHETAN)
Signal: Revenue declined
The read
The operating trajectory weakened materially: revenue fell 19.3% YoY to ₹406.26 lakh, gross margin compressed 4,319bps to 7.2%, and core EBIT moved from a ₹46.59 lakh profit to an ₹81.23 lakh loss; the apparent PAT growth of 316.7% to ₹315.83 lakh was entirely dominated by other income of ₹445.24 lakh. The proposed capacity increase to 75,000 MT could support future scale, but the filing provides no implementation timeline or funding detail.
| Metric | Value | YoY | QoQ |
|---|---|---|---|
| Revenue | ₹4.06 Cr | -19.3% | -52.2% |
| EBIT | ₹-0.81 Cr | -274.4% | |
| Net profit | ₹3.16 Cr | +316.7% | |
| EPS | ₹0.04 | +300.0% | |
| EBIT margin | -20.0% |
P&L walk
Revenue declined to ₹406.26 lakh, -19.3% YoY and -52.2% QoQ, while gross margin compressed to 7.2% from 50.4% YoY as raw material cost rose to 116.9% of revenue; core EBIT turned to a ₹81.23 lakh loss, but PAT reached ₹315.83 lakh because other income of ₹445.24 lakh exceeded operating revenue.
Key positives
- Finance cost declined 13.6% YoY to ₹33.28 lakh despite the weak operating quarter.
- The company approved a capacity enhancement from 45,000 MT per annum to 75,000 MT per annum, a 66.7% planned increase in production capacity.
- PAT increased 316.7% YoY to ₹315.83 lakh and EPS rose 300.0% to ₹0.04, with unchanged paid-up equity share capital.
Key concerns
- Revenue declined 19.3% YoY to ₹406.26 lakh and 52.2% QoQ, with no volume or realisation explanation disclosed.
- Gross margin compressed 4,319bps YoY to 7.2% as raw material cost rose to 116.9% of revenue from 72.6%, indicating severe input-cost absorption or adverse operating mix.
- Core EBIT turned into a ₹81.23 lakh loss from a ₹46.59 lakh profit YoY, despite employee and other expenses falling 50.6%.
- The proposed capacity increase has no disclosed commissioning timeline, capex amount or funding plan.
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