Sumeet Industrie Q2 FY27 Results (NSE: SUMEETINDS)
Signal: Margin pressure
The read
The growth inflection is volume or mix-undisclosed revenue acceleration to 36417.64 lakh, +35.3% YoY, but it came with a second consecutive quarter of YoY margin contraction: EBITDA margin fell to 2.53% from 5.39% as raw-material intensity rose to 86.42% from 76.75%; the rights issue improved liquidity but diluted EPS to ₹0.08.
| Metric | Value | YoY | QoQ |
|---|---|---|---|
| Revenue | ₹364.18 Cr | +35.3% | +33.7% |
| EBIT | ₹4.3 Cr | -54.1% | |
| Net profit | ₹5.67 Cr | -42.5% | |
| EPS | ₹0.08 | -55.6% | |
| EBIT margin | 2.53% |
P&L walk
Consolidated revenue increased to 36417.64 lakh, +35.3% YoY and +33.7% QoQ, but gross margin compressed to 17.13% from 22.88% as raw-material cost rose to 86.42% of revenue from 76.75%; EBITDA margin fell to 2.53%, while PAT was supported by 62.88 lakh of associate profit and 294.40 lakh of other income.
Segments
The company reports a single textile products segment; the main consolidated-versus-standalone divergence is 62.88 lakh of associate profit, lifting consolidated PAT to 567.06 lakh from standalone PAT of 440.17 lakh.
Key positives
- Revenue increased to 36417.64 lakh, +35.3% YoY and +33.7% QoQ, a sharp acceleration from the recent Q1FY27 growth rate of 9.6%.
- Finance cost fell 27.1% QoQ to 220.38 lakh, while total borrowings declined to 13754.87 lakh and the balance sheet moved to net cash of 2332.24 lakh.
- H1 operating cash flow was positive at 953.32 lakh despite 5621.34 lakh of investing cash outflow, and FDY capacity increased to 160 tons per day from 120 tons per day effective 1 September 2026.
- Employee benefits expense rose only 7.1% YoY to 809.66 lakh against 35.3% revenue growth, providing some fixed-cost containment despite the gross-margin setback.
Key concerns
- Gross margin compressed 575bps YoY to 17.13% as raw-material cost rose to 86.42% of revenue from 76.75%; revenue grew but the company absorbed the cost pressure and the filing did not disclose a driver.
- EBITDA margin declined 286bps YoY to 2.53%, reversing the recent margin-expansion sequence and remaining well below the approximately 6% FY27 target cited in prior company context.
- EPS fell 55.6% YoY to ₹0.08, lagging the 42.5% PAT decline because paid-up capital increased to 14063.62 lakh after the 19975.11 lakh rights issue.
- The acquired Nakoda Phase-3 chips plant is now consolidated through SSCL, but the filing provides no operating revenue or profit contribution yet; current consolidated comparatives are also not fully comparable because SSCL became a subsidiary on 17 August 2026.
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