S P Apparels Q1 FY27 Results (NSE: SPAL)
Signal: Revenue declined
The read
The key inflection is a Q1FY27 margin recovery: consolidated EBITDA margin rose to 15.3% from 12.2% in Q4FY26 and PAT increased 33.8% QoQ to Rs 248.74 million, but consolidated revenue was still down 0.6% YoY and the UK subsidiary remained loss-making at Rs 10.4 million EBITDA.
| Metric | Value | YoY | QoQ |
|---|---|---|---|
| Revenue | ₹401.08 Cr | -0.6% | +9.9% |
| Net profit | ₹24.87 Cr | +20.4% | |
| EPS | ₹9.89 | +20.2% | |
| EBIT margin | 15.3% |
P&L walk
Consolidated revenue was Rs 4,010.76 million, down 0.6% YoY and up 9.9% QoQ; EBITDA rose 37.5% QoQ to Rs 613.6 million, lifting margin to 15.3%, while finance cost increased 26.1% YoY and the associate loss remained a drag at Rs 8.72 million.
Segments
The parent garment operation generated Rs 3,373.3 million of revenue and Rs 592.3 million of EBITDA, while S.P. Apparels UK grew 125.2% YoY to Rs 333.0 million but remained loss-making with EBITDA of Rs 10.4 million; the UK subsidiary is the main disclosed drag on the consolidated margin.
Key positives
- Consolidated EBITDA increased 37.5% QoQ to Rs 613.6 million versus revenue growth of 9.9% QoQ, with EBITDA margin expanding 310bps to 15.3%.
- Standalone EBITDA rose 6.7% YoY to Rs 465.8 million and margin expanded 230bps to 17.5% despite standalone revenue declining 5.0% YoY.
- Standalone finance costs declined 66.4% YoY to Rs 24.21 million, helping standalone PAT grow 33.4% to Rs 265.37 million.
- S.P. Apparels UK revenue grew 125.2% YoY to Rs 333.0 million, indicating rapid international expansion despite the current Rs 10.4 million EBITDA loss.
- The proposed 1:5 share split is intended to improve affordability and liquidity, subject to shareholder and regulatory approvals.
Key concerns
- Consolidated revenue declined 0.6% YoY to Rs 4,010.76 million, indicating that the profit recovery is currently more margin-led than growth-led.
- S.P. Apparels UK remained loss-making at Rs 10.4 million EBITDA on Rs 333.0 million revenue, limiting the translation of its 125.2% revenue growth into group profit.
- Consolidated finance costs increased 26.1% YoY to Rs 148.55 million and 72.7% QoQ, creating a rising drag below EBITDA.
- Consolidated PAT of Rs 248.74 million was below standalone PAT of Rs 265.37 million, showing that subsidiaries and the associate diluted the parent-level earnings outcome.
Research and educational content only. Not investment advice.