Westlife Food Q1 FY27 Results (NSE: WESTLIFE)
Signal: Growth reaccelerated
The read
Q1FY27 consolidated revenue grew 11.9% YoY, but gross margin collapsed 406bps to 67.6% as cost of materials soared 27.9%, indicating severe input cost headwinds. EBITDA margin slipped 34bps to 12.63%, and with depreciation and finance costs rising ~9% each, net profit plunged 52% to ₹58.68 lakh. The sharp margin compression and lower profitability, despite healthy revenue growth, underscore ongoing structural pressure from rising costs and high leverage (D/E 2.92x).
| Metric | Value | YoY | QoQ |
|---|---|---|---|
| Revenue | ₹735.64 Cr | 11.86% | 12.25% |
| EBIT | ₹39.56 Cr | 6.64% | |
| Net profit | ₹0.59 Cr | -52.2% | |
| EPS | ₹0.04 | -50.0% | |
| EBIT margin | 12.63% |
P&L walk
Revenue grew 11.9% YoY but gross margin collapsed 406bps as cost of materials surged 27.9% vs 11.9% revenue growth; EBITDA margin narrowed 34bps to 12.63%, and higher depreciation and finance costs ate into profits, resulting in PAT of Rs.58.68 lakh (down 52% YoY).
Key positives
- Revenue growth of 11.9% YoY, accelerating from 8.7% in Q4FY26, suggesting improving customer demand.
- EBITDA (computed) grew 8.9% YoY to ₹9,292 lakh, reflecting some operating leverage despite margin compression.
- No exceptional items in the quarter (vs large gains in prior year), making earnings more operational.
Key concerns
- Gross margin contracted sharply by 406bps YoY to 67.6% as input costs (cost of materials) surged 27.9%, far outpacing revenue growth, indicating limited pricing power.
- Net profit fell 52.2% YoY despite higher revenue, due to elevated depreciation and finance costs.
- Debt-to-equity of 2.92x (from fundamentals) implies high financial leverage, increasing vulnerability to margin swings.
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