Sterling & Wils. Q1 FY27 Results (NSE: SWSOLAR)
Signal: Margin expansion
The read
The operating inflection remains margin-led rather than growth-led: consolidated revenue fell 9.8% YoY to ₹1,590.13 crore, but EBITDA margin expanded 140bps to 6.2% and PAT rose 39.0% to ₹54.22 crore; the quality of the profit recovery is weakened because other income of ₹20.18 crore contributed 35.6% of PBT, while O&M growth outpaced EPC.
| Metric | Value | YoY | QoQ |
|---|---|---|---|
| Revenue | ₹1,590.13 Cr | -9.8% | -18.3% |
| EBIT | ₹95.57 Cr | N/A | |
| Net profit | ₹54.22 Cr | +39.0% | |
| EPS | ₹2.32 | +69.3% | |
| EBIT margin | 6.2% |
P&L walk
Consolidated revenue declined to ₹1,590.13 crore, -9.8% YoY and -18.3% QoQ, while EBITDA rose to ₹98.88 crore and margin expanded to 6.2%; PAT of ₹54.22 crore also benefited from ₹20.18 crore of other income, equal to 35.6% of PBT.
Segments
O&M was the momentum pocket, with revenue up 39.1% YoY to ₹67.83 crore and segment result up 46.0% to ₹14.51 crore, while EPC revenue rose only 7.9% and EPC result declined 1.9% to ₹139.89 crore.
Key positives
- Consolidated EBITDA reached ₹98.88 crore, up 39.1% YoY despite revenue declining 9.8%, expanding EBITDA margin to 6.2% from 4.8%.
- O&M revenue increased 39.1% YoY to ₹67.83 crore and O&M result rose 46.0% to ₹14.51 crore, providing a faster-growing, higher-quality service component.
- Standalone PAT recovered to ₹67.80 crore from a ₹78.16 crore loss in the preceding quarter, which contained a ₹163.76 crore exceptional charge.
Key concerns
- Consolidated revenue declined 9.8% YoY and 18.3% QoQ to ₹1,590.13 crore, so margin improvement has not yet translated into renewed top-line momentum.
- Other income of ₹20.18 crore represented 35.6% of consolidated PBT, making the ₹54.22 crore PAT less purely operating in character.
- Finance cost increased 33.9% YoY to ₹38.88 crore on a standalone basis, faster than the 9.1% decline in standalone revenue.
Earnings quality: includes non-operating other income
Research and educational content only. Not investment advice.