Softtech Enginee Q1 FY27 Results (NSE: SOFTTECH)
Signal: Margin expansion
The read
The key inflection is a consolidated EBITDA-margin rebound to 28.9%, up 280bps YoY and 748bps QoQ after Q4FY26's 21.4%, but the trajectory is not yet clean: revenue grew 23.2% while EBITDA grew only 14.2%, EBIT was up just 0.4%, and owner PAT growth was 10.1%; the parent remains materially stronger than the subsidiaries, with standalone PAT of ₹191.89 lakh versus consolidated owner PAT of ₹104.17 lakh.
| Metric | Value | YoY | QoQ |
|---|---|---|---|
| Revenue | ₹33.28 Cr | 23.2% | -28.7% |
| EBIT | ₹2.79 Cr | 0.4% | |
| Net profit | ₹1.04 Cr | 9.5% | |
| EPS | ₹0.75 | 8.7% | |
| EBIT margin | 28.9% |
P&L walk
Consolidated revenue increased to ₹3328.46 lakh, +23.2% YoY but -28.7% QoQ; EBITDA rose 14.2% YoY to ₹963 lakh and margin expanded to 28.9%, while EBIT was nearly flat at ₹279 lakh and PAT attributable to owners rose only 10.1% to ₹104.17 lakh.
Key positives
- Consolidated revenue increased 23.2% YoY to ₹3328.46 lakh, sustaining growth after FY26's recovery.
- EBITDA margin expanded 280bps YoY to 28.9% and 748bps QoQ from 21.4%, reversing the Q4FY26 margin trough.
- Employee costs rose only 1.7% YoY to ₹807.63 lakh, while revenue rose 23.2%, supporting the margin recovery.
- Standalone revenue grew 24.9% YoY and standalone EBITDA margin was 32.1%, demonstrating stronger parent-level economics than the group.
Key concerns
- EBITDA growth of 14.2% lagged revenue growth of 23.2%, so the 280bps margin expansion did not translate into proportionate operating-profit growth.
- Consolidated EBIT increased only 0.4% YoY to ₹279 lakh despite 23.2% revenue growth, reflecting depreciation of ₹683.70 lakh and weaker below-EBIT conversion.
- Consolidated owner PAT of ₹104.17 lakh was 45.7% below standalone PAT of ₹191.89 lakh, confirming that subsidiaries are materially dragging group profitability.
Earnings quality: includes non-operating other income
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