Sunteck Realty Q2 FY27 Results (NSE: SUNTECK)
Signal: Margin pressure
The read
The quarter shows a sharp sequential revenue recovery to ₹32,081.21 lakh, +67.5% QoQ, but the trajectory is mixed: operating margin contracted 500bps YoY to 26% after two prior quarters of margin contraction, while PAT still grew 16.6% to ₹5,711.36 lakh. The more important investor watchpoint is whether gross margin recovers from approximately 47.5% and whether H1 operating cash flow of negative ₹29,349.66 lakh improves as inventory reaches ₹8,29,130.51 lakh.
| Metric | Value | YoY | QoQ |
|---|---|---|---|
| Revenue | ₹320.81 Cr | +27.1% | +67.5% |
| Net profit | ₹57.11 Cr | +16.6% | |
| EPS | ₹3.96 | +18.6% | |
| EBIT margin | 26% |
P&L walk
Revenue accelerated to ₹32,081.21 lakh, +27.1% YoY and +67.5% QoQ, but gross margin fell to about 47.5% from 53.9% YoY and 73.0% QoQ, taking operating margin to 26% from 31% YoY; PAT still rose 16.6% to ₹5,711.36 lakh because finance-cost growth was limited to 6.2% and other income increased 32.8%.
Key positives
- Revenue from operations reached ₹32,081.21 lakh, up 27.1% YoY and 67.5% QoQ, reversing the prior-quarter sequential slowdown.
- PAT rose 16.6% YoY to ₹5,711.36 lakh and basic EPS rose 18.6% to ₹3.96 despite a 500bps YoY operating-margin contraction.
- Finance costs increased only 6.2% YoY to ₹2,119.74 lakh versus 27.1% revenue growth, while interest service coverage was 4.01x versus 3.90x a year earlier.
- Property, plant and equipment rose to ₹8,016.08 lakh while depreciation increased only 2.5% YoY to ₹389.71 lakh, a clean depreciation-to-capex signal.
Key concerns
- Gross margin compressed to approximately 47.5% from 53.9% YoY and 73.0% QoQ; the filing does not disclose the cause.
- Operating margin fell to 26% from 31% YoY and 35% QoQ, extending the margin contraction seen in the prior two quarters.
- Operating cash flow was negative ₹29,349.66 lakh in H1FY27 versus negative ₹16,739.32 lakh in H1FY26, despite H1 PAT of ₹9,907.38 lakh.
- Inventory stood at ₹8,29,130.51 lakh, while trade receivables rose to ₹19,964.55 lakh from ₹11,254.27 lakh at 31 March 2026.
Research and educational content only. Not investment advice.