Tenneco Clean Q2 FY27 Results (NSE: TENNIND)
Signal: Margin pressure
The read
The trajectory is top-line positive but margin-sensitive: revenue growth accelerated to 34.2% YoY from 20.1% in Q1FY27, yet operating EBITDA growth of 20.7% lagged and margin fell to 15.2% from an estimated 16.3% a year earlier; PAT growth was supported by lower YoY finance cost but remains below revenue growth.
| Metric | Value | YoY | QoQ |
|---|---|---|---|
| Revenue | ₹1,718.34 Cr | +34.2% | +11.2% |
| EBIT | ₹261.58 Cr | +20.7% | |
| Net profit | ₹173.36 Cr | +15.1% | |
| EPS | ₹4.29 | +15.0% | |
| EBIT margin | 15.2% |
P&L walk
Consolidated revenue rose 34.2% YoY to INR 17,183.41 million, while operating EBITDA rose 20.7% to INR 2,615.80 million and margin contracted to 15.2%; PAT nevertheless increased 15.1% to INR 1,733.58 million as finance cost declined 6.3% and tax remained proportionate.
Segments
The group is reported as a single operating segment, but the consolidated business is materially larger than the parent: Q2 revenue was INR 17,183.41 million versus standalone INR 7,184.23 million, while consolidated PAT was INR 1,733.58 million versus standalone INR 1,027.20 million.
Key positives
- Consolidated revenue reached INR 17,183.41 million, up 34.2% YoY and 11.2% QoQ, accelerating from 20.1% YoY growth in Q1FY27.
- Consolidated PAT increased 15.1% YoY to INR 1,733.58 million, while EPS rose 15.0% to INR 4.29 with the PAT-to-EPS cross-check clean.
- H1FY27 capital expenditure including CWIP was INR 1,190.59 million versus INR 245.92 million in H1FY26, and CWIP rose to INR 1,527.50 million, indicating an active capacity-investment cycle.
- Cash and cash equivalents increased to INR 9,146.27 million from INR 5,712.26 million at 31 March 2026, despite H1FY27 capex outflow of INR 1,190.59 million.
Key concerns
- Operating EBITDA grew 20.7% YoY to INR 2,615.80 million, 13.5 percentage points below revenue growth, and operating margin contracted 110bps to 15.2%.
- Raw-material and related manufacturing input intensity increased to 67.6% of revenue from 66.4% YoY, compressing gross margin by 120bps; the filing does not disclose the cause.
- H1FY27 operating cash flow fell to INR 4,677.24 million from INR 11,220.24 million despite H1 profit before tax of INR 4,521.75 million, with inventories absorbing INR 975.93 million.
- Standalone PAT of INR 1,027.20 million was 89.1% below the year-ago INR 9,387.48 million because the prior period contained INR 8,644.98 million of other income, highlighting the importance of consolidated operating earnings.
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