Revenue grew +13.93%, but faster costs cut Aarti Pharmalabs margin
Consolidated operating margin fell 3.26 percentage points sequentially as expenses outpaced revenue, while higher interest also reduced pre-tax profit.
Filed 28 Oct 2026, 21:02 IST · after market close · Aarti Pharmalabs Ltd (AARTIPHARM)
Key takeaways
- Consolidated revenue rose +13.93% sequentially to Rs 610.45 cr, but expenses grew +18.91%, cutting operating margin by 3.26 percentage points.
- Net profit fell -6.13% sequentially to Rs 71.47 cr as interest rose +16.07% and other income contributed 5.59% of pre-tax profit.
- The 22.14% operating margin remained 2.24 percentage points above the 19.90% median of 23 reported Healthcare peers.
Price around the results
Revenue growth did not translate into profit growth
Aarti Pharmalabs reported consolidated revenue growth of +13.93% sequentially, but operating profit declined -0.70% because expenses rose faster than sales. Pre-tax profit fell -6.01%, with other income also down -32.44% from Q1FY27. The company filed these results after market close on 28 Oct 2026.
Higher costs and interest compressed the quarter
Expenses increased +18.91% sequentially against revenue growth of +13.93%, pulling operating margin down from 25.40% to 22.14%, a decline of 3.26 percentage points. Interest expense rose +16.07%, adding to the pressure on pre-tax profit. Other income was 5.59% of pre-tax profit, while the tax rate increased by 0.10 percentage points, so neither provided a material reported-profit lift.
Margin remained above the Healthcare peer median
The 22.14% operating margin was 2.24 percentage points above the 19.90% median among 23 Healthcare peers that had reported the quarter. Sequentially, however, margin moved lower from Q1FY27's 25.40%, making cost control the key change in this quarter's performance.
Q2FY27 at a glance
Consolidated figures as filed with NSE — filed ahead of third-party databases, not yet independently cross-checked.
| Line item | Q2FY27 | Q1FY27 | QoQ |
|---|---|---|---|
| Revenue | ₹610 cr | ₹536 cr | +13.93% |
| Other income | ₹5 cr | ₹8 cr | -32.44% |
| Expenses | ₹475 cr | ₹400 cr | +18.91% |
| Operating profit | ₹135 cr | ₹136 cr | -0.70% |
| Operating margin (%) | 22.14% | 25.40% | — |
| Interest | ₹15 cr | ₹13 cr | +16.07% |
| Depreciation | ₹31 cr | ₹30 cr | +1.67% |
| Profit before tax | ₹95 cr | ₹101 cr | -6.01% |
| Tax | ₹24 cr | ₹25 cr | -5.62% |
| Net profit | ₹71 cr | ₹76 cr | -6.13% |
| EPS (₹) | ₹7.88 | ₹8.40 | -6.19% |
Operating margin of 22.14% compares with a Healthcare sector median of 19.90% across 23 peers that have reported Q2FY27.
What to watch
- Whether operating margin recovers from 22.14% after the 3.26-percentage-point sequential decline.
- Whether expense growth moderates from +18.91% relative to revenue growth of +13.93%.
- Whether interest growth eases from +16.07% and other income remains a limited 5.59% of pre-tax profit.