Salasar Techno Q1 FY27 Results (NSE: SALASAR)
Signal: Revenue declined
The read
The quarter shows an operating inflection from Q4FY26's approximately 3.1% EBITDA margin to 8.6%, but the recovery is incomplete: revenue fell 1.5% YoY, EBITDA declined 19.4%, finance costs rose 10.7%, and owner PAT fell 41.4%; Steel Structures is carrying the business while EPC remains materially weaker, and other income equal to 95.9% of PBT makes reported earnings low quality.
| Metric | Value | YoY | QoQ |
|---|---|---|---|
| Revenue | ₹295.54 Cr | -1.5% | -33.5% |
| EBIT | ₹18.89 Cr | -26.0% | |
| Net profit | ₹4.99 Cr | -41.4% | |
| EPS | ₹0.03 | -40.0% | |
| EBIT margin | 8.6% |
P&L walk
Revenue declined 1.5% YoY to ₹29553.98 lakh, but gross margin improved to approximately 21.7% from 20.5%; EBITDA fell 19.4% to ₹2544 lakh and EBIT fell 26.0% to ₹1889 lakh, with finance costs up 10.7% and PAT attributable to owners down 41.4% to ₹499.20 lakh.
Segments
Steel Structures drove the group with revenue of ₹20688.62 lakh, up 21.4% YoY, and segment result of ₹2142.60 lakh, up 5.1%; EPC Projects dragged growth with revenue down 31.2% YoY and result down 79.4% to ₹196.87 lakh, although it recovered from a ₹1684.91 lakh loss sequentially.
Key positives
- Steel Structures revenue was ₹20688.62 lakh, up 21.4% YoY, and segment result was ₹2142.60 lakh, up 5.1% YoY, making it the principal earnings engine.
- EPC Projects segment result improved to ₹196.87 lakh from a ₹1684.91 lakh loss sequentially, indicating a quarterly turnaround, although absolute profitability remains low.
- Consolidated EBITDA margin recovered to 8.6% from approximately 3.1% in Q4FY26, a sequential improvement of roughly 550bps.
- Segment assets increased 41.1% YoY to ₹214296.83 lakh, supporting capacity and execution potential if asset utilisation improves.
Key concerns
- Consolidated revenue declined 1.5% YoY to ₹29553.98 lakh and EBITDA declined 19.4% to ₹2544 lakh, showing that the margin rebound has not yet translated into operating growth.
- EPC revenue fell 31.2% YoY to ₹9555.25 lakh and EPC segment result fell 79.4% YoY to ₹196.87 lakh, leaving the group increasingly dependent on Steel Structures.
- Finance costs rose 10.7% YoY to ₹1524.05 lakh, faster than revenue, while the expanded asset base raises the importance of future utilisation and returns.
- Employee benefits plus other expenses rose 32.4% YoY to ₹4202.87 lakh despite a 1.5% revenue decline, indicating adverse operating-cost absorption.
Earnings quality: includes non-operating other income
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