Varmora Granito Q2 FY27 Results (NSE: VARMORA)
Signal: Steady quarter
The read
The operating trajectory improved, with consolidated revenue at ₹3900.85 million, +11.8% YoY, and EBITDA at ₹554.28 million, +33.4% YoY; however, the apparent margin inflection is not fully organic because depreciation fell 59.2% YoY after the accounting-estimate change and standalone PAT absorbed a ₹178.67 million Simola disposal loss.
| Metric | Value | YoY | QoQ |
|---|---|---|---|
| Revenue | ₹390.09 Cr | +11.8% | +12.0% |
| EBIT | ₹42.51 Cr | +41.0% | |
| Net profit | ₹38.18 Cr | +143.1% | |
| EPS | ₹2.23 | +185.9% | |
| EBIT margin | 14.2% |
P&L walk
Consolidated revenue was ₹3900.85 million, +11.8% YoY and +12.0% QoQ; EBITDA rose to ₹554.28 million, +33.4% YoY, helped by lower raw-material intensity and sharply lower depreciation, while PAT was ₹381.81 million, +143.1% YoY, despite a ₹5.51 million exceptional loss.
Segments
The group result is materially above standalone PAT of ₹232.86 million because consolidated PAT was ₹381.81 million; standalone earnings were dragged by the ₹178.67 million Simola Tiles disposal loss, while the group also includes subsidiaries, associates and joint ventures.
Key positives
- Consolidated EBITDA rose to ₹554.28 million, +33.4% YoY, outpacing revenue growth of +11.8% by 21.6 percentage points; employee costs fell 11.0% YoY and other expenses fell 7.0% YoY.
- Raw-material intensity improved to 24.8% of consolidated revenue from 26.5% YoY, a 170bps improvement, although the filing does not identify the driver.
- Operating cash flow increased to ₹771.89 million in H1FY27 from ₹383.33 million in H1FY26.
- IPO proceeds of ₹2960.43 million lifted cash and moved the standalone balance sheet from net debt of ₹1667.99 million to net cash of ₹1552.76 million.
Key concerns
- The 230bps consolidated EBITDA-margin expansion to 14.2% is partly driven by a 59.2% YoY reduction in depreciation after the switch to straight-line depreciation, rather than only by core operating improvement.
- Standalone profit was burdened by a ₹178.67 million loss on the sale of Simola Tiles operations, highlighting continued weakness in that subsidiary and the cost of portfolio rationalisation.
- Revenue growth is not decomposed into volume and price/mix because the filing discloses neither volumes nor realisations.
Research and educational content only. Not investment advice.