SRIT India Q1 FY27 Results (NSE: SRIT)
Signal: Margin expansion
The read
The key inflection is cost-led margin resilience rather than demand recovery: consolidated revenue fell 42.0% YoY to ₹878.10 million, while EBIT margin expanded 421bps to 10.8% because subcontracting costs fell 53.1%; however, employee costs rose 18.6%, depreciation rose 72.2%, and PAT still declined 10.3% to ₹68.07 million.
| Metric | Value | YoY | QoQ |
|---|---|---|---|
| Revenue | ₹87.81 Cr | -42.0% | -24.9% |
| EBIT | ₹9.49 Cr | -5.0% | |
| Net profit | ₹6.81 Cr | -10.3% | |
| EPS | ₹1.43 | -18.3% | |
| EBIT margin | 10.8% |
P&L walk
Consolidated revenue declined to ₹878.10 million, down 42.0% YoY and 24.9% QoQ, but the lower subcontracting burden lifted EBIT margin to 10.8% from 6.6% YoY; PAT still declined 10.3% to ₹68.07 million as depreciation and finance costs increased.
Key positives
- Consolidated EBIT margin expanded 421bps YoY to 10.8% as subcontracting costs fell 53.1%, faster than the 42.0% revenue decline.
- Other income increased 14.6% YoY to ₹29.97 million, providing some support to pre-tax earnings during the revenue contraction.
- Finance costs were broadly stable YoY at ₹33.77 million versus ₹33.09 million, despite the quarter's lower revenue base.
Key concerns
- Revenue declined 42.0% YoY to ₹878.10 million and 24.9% QoQ, with the filing providing no volume, utilisation or pricing explanation.
- Employee benefits expense increased 18.6% YoY to ₹110.67 million even as revenue fell 42.0%, lifting employee costs to 12.6% of revenue from 6.2%.
- Depreciation increased 72.2% YoY to ₹29.25 million, limiting the conversion of improved operating margin into PAT.
- EPS declined 18.3% YoY to ₹1.43, materially worse than the 10.3% PAT decline, indicating dilution or a higher share count.
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