Seshasayee Paper Q2 FY27 Results (NSE: SESHAPAPER)
Signal: Growth reaccelerated
The read
The operating recovery remains intact: consolidated revenue rose 45.3% YoY to ₹503.06 crore and EBITDA margin improved 24bps YoY to 11.69%, but gross margin compressed 172bps and consolidated PAT growth to ₹42.31 crore was amplified by ₹7.30 crore of associate profit; the key trajectory question is whether margin recovery can continue without relying on non-operating earnings.
| Metric | Value | YoY | QoQ |
|---|---|---|---|
| Revenue | ₹503.06 Cr | +45.3% | +2.2% |
| EBIT | ₹47.16 Cr | +65.5% | |
| Net profit | ₹42.31 Cr | +88.8% | |
| EPS | ₹7.03 | +89.0% | |
| EBIT margin | 11.69% |
P&L walk
Consolidated revenue increased to ₹503.06 crore, +45.3% YoY and +2.2% QoQ, but gross margin contracted 172bps YoY to 37.67%; EBITDA rose 48.3% to ₹58.78 crore, PAT grew 88.8% to ₹42.31 crore, and ₹7.30 crore of associate profit materially supported pre-tax earnings.
Key positives
- Consolidated revenue increased 45.3% YoY to ₹503.06 crore and 2.2% QoQ, extending the recovery from ₹346.32 crore in the year-ago quarter.
- Finance costs fell 92.3% YoY to ₹0.34 crore as borrowings reduced to ₹0.00 crore from ₹76.75 crore.
- H1 operating cash flow improved to ₹39.49 crore from negative ₹72.93 crore, while H1 revenue rose 36.0% to ₹995.14 crore.
- EBITDA increased 48.3% YoY to ₹58.78 crore and EBITDA margin expanded 24bps to 11.69%, although the margin improvement was modest relative to the revenue rebound.
Key concerns
- Gross margin contracted 172bps YoY to 37.67% despite revenue growth of 45.3%; the filing does not identify the cause or quantify volume growth.
- Consolidated PAT of ₹42.31 crore includes ₹7.30 crore of associate profit, meaning approximately 17% of reported PAT came from the associate contribution rather than the standalone paper operation.
- Power and fuel cost increased 20.4% YoY to ₹59.18 crore and other expenses increased 59.7% to ₹54.53 crore, keeping cost pressure visible below gross profit.
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