Vardhman Special Q2 FY27 Results (NSE: VSSL)
Signal: Steady quarter
The read
The Q2 inflection is volume-led acceleration: revenue growth rose to 38.81% from Q1FY27's 12.06%, with volume up 27.13% and EBITDA up 48.48% to ₹83.86 crore; however, the 13.98% EBITDA margin also reflects GST refund and lower-cost inventory benefits, so underlying margin durability remains to be confirmed.
| Metric | Value | YoY | QoQ |
|---|---|---|---|
| Revenue | ₹600.05 Cr | 38.81% | 23.46% |
| Net profit | ₹52.49 Cr | 51.88% | |
| EPS | ₹5.43 | 50.42% | |
| EBIT margin | 13.98% |
P&L walk
Standalone Q2 revenue increased 38.81% YoY to ₹600.05 crore on 27.13% higher reported sales volume and higher realisations; EBITDA rose 48.48% to ₹83.86 crore, supported by volume, realisation, GST refund, lower-cost inventory and benefits from prior capex, while PAT increased 51.88% to ₹52.49 crore.
Key positives
- Sales volume increased 27.13% YoY to 70,601 tonnes, while revenue grew faster at 38.81% to ₹600.05 crore, indicating higher realisations alongside volume growth.
- EBITDA rose 48.48% YoY to ₹83.86 crore and EBITDA margin reached 13.98%, supported by higher volumes, realisations and progressive benefits from the Kocks Block and reheating furnace capex.
- Q2FY27 revenue growth of 38.81% accelerated materially from Q1FY27's 12.06%, while PAT growth remained strong at 51.88%.
- The forging facility foundation stone was laid during the quarter, supporting the stated move toward higher-value forged components and forward integration.
Key concerns
- Management attributed EBITDA improvement partly to a GST refund and the benefit of lower-cost raw material inventory carried forward from the previous quarter, making the 13.98% margin less clearly recurring.
- EBITDA growth of 48.48% lagged revenue growth of 38.81% only modestly, so the quarter does not establish a broad-based margin expansion trend beyond the disclosed cost and mix benefits.
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