Ajax margin slips as expenses outpace revenue growth
Standalone Q2 profit fell 8.44% sequentially, while other income supplied 29.05% of pre-tax profit.
Filed 06 Nov 2026, 13:27 IST · Ajax Engineering Ltd (AJAXENGG)
Key takeaways
- Standalone operating margin fell by 1.89 percentage points sequentially to 10.57% as expenses grew 4.84% while revenue grew 2.62%.
- Net profit declined 8.44% sequentially even as interest expense fell 80.00%, because operating profit dropped 12.99%.
- Other income contributed 29.05% of pre-tax profit, while Ajax's 10.57% margin was 0.91 percentage points below the 11.48% Industrials peer median.
Price around the results
Higher costs cut into Q2 operating margin
Ajax Engineering's standalone revenue grew 2.62% sequentially, but expenses rose faster at 4.84%, reducing operating profit by 12.99%. Operating margin fell from 12.46% in Q1FY27 to 10.57%, a decline of 1.89 percentage points. This marks a weaker sequential margin direction despite modest revenue growth.
Other income made a material contribution to profit
Other income accounted for 29.05% of pre-tax profit, so reported earnings were not driven solely by operations. The tax rate rose by 0.20 percentage points sequentially to 25.37%, offering no tax-rate boost to net profit. Interest expense fell 80.00%, but the benefit was outweighed by the operating profit decline.
Margin trails the Industrials peer median
Among 180 Industrials companies that have reported, Ajax's 10.57% operating margin was 0.91 percentage points below the sector median of 11.48%. The comparison places the quarter's margin below the reported peer midpoint as operating costs grew faster than revenue.
Q2FY27 at a glance
Standalone figures as filed with NSE — filed ahead of third-party databases, not yet independently cross-checked.
| Line item | Q2FY27 | Q1FY27 | QoQ |
|---|---|---|---|
| Revenue | ₹487 cr | ₹475 cr | +2.62% |
| Other income | ₹20 cr | ₹18 cr | +8.90% |
| Expenses | ₹436 cr | ₹415 cr | +4.84% |
| Operating profit | ₹51 cr | ₹59 cr | -12.99% |
| Operating margin (%) | 10.57% | 12.46% | — |
| Interest | ₹0 cr | ₹0 cr | -80.00% |
| Depreciation | ₹3 cr | ₹3 cr | +6.71% |
| Profit before tax | ₹68 cr | ₹74 cr | -8.20% |
| Tax | ₹17 cr | ₹19 cr | -7.43% |
| Net profit | ₹51 cr | ₹56 cr | -8.44% |
| EPS (₹) | ₹4.45 | ₹4.86 | -8.44% |
Operating margin of 10.57% compares with a Industrials sector median of 11.48% across 180 peers that have reported Q2FY27.
How the stock reacted
| Window | Stock | vs NIFTY |
|---|---|---|
| Results day | -0.47% | -2.48% |
Volume on the results session was 1.29× its 20-day average.
What to watch
- Whether operating margin recovers from 10.57% after the 1.89-percentage-point sequential decline.
- Whether expense growth narrows from 4.84% relative to revenue growth of 2.62%.
- Whether other income's 29.05% share of pre-tax profit declines.