TVS Elec. Q1 FY27 Results (NSE: TVSELECT)
Signal: Margin expansion
The read
Revenue and PAT both grew strongly YoY on a low base, but QoQ revenue fell nearly 22% (seasonal). Gross margin held steady YoY at ~25.8%; employee cost ratio improved. Main concern: negative operating cash flow widened despite higher profits, driven by working capital build. The sequential dip and cash flow need watching.
| Metric | Value | YoY | QoQ |
|---|---|---|---|
| Revenue | ₹9.78 Cr | 15.6% | -21.9% |
| EBIT | ₹0.3 Cr | 92.4% | |
| Net profit | ₹0.22 Cr | 92.2% | |
| EPS | ₹1.35 | 92.9% | |
| EBIT margin | 3.1% |
P&L walk
Revenue grew 15.6% YoY to ₹97.8 Cr; gross margin stable at ~25.8% (flat YoY); employee cost ratio improved 130bps to 11.5%. Despite revenue falling QoQ -21.9% (seasonal), PAT jumped +92% YoY on better cost control and low base. Negative operating cash flow of ₹5.08 Cr is a concern.
Segments
Both segments grew YoY: Printer and consumables +15.1%, services and solutions +16.3%; however, QoQ both declined ~20%+ seasonally. Printer segment profit jumped 94.5% YoY, while services profit grew only 10.3% YoY.
Key positives
- Revenue grew 15.6% YoY, with both segments contributing.
- PAT more than doubled YoY on operating leverage and cost improvement.
- Employee cost ratio decreased 130bps YoY to 11.5%.
- Raw material cost ratio declined 140bps YoY to 71.8%.
Key concerns
- QoQ revenue fell 21.9% – likely seasonal but significant.
- Operating cash flow worsened to -₹5.08 Cr (vs -₹2.1 Cr YoY) due to inventory and receivables build.
- Gross margin compressed sharply QoQ (-810bps) on lower revenue absorption.
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