Balkrishna profit jumps 56%, but operating margin slips sequentially
Revenue growth outpaced costs YoY, while a second straight quarterly margin decline and other income's 16.58% contribution qualify the result.
Filed 29 Jul 2026, 17:41 IST · after market close · Balkrishna Industries Ltd (BALKRISIND)
Key takeaways
- Consolidated net profit rose +56.35% YoY as revenue grew +25.19% while expenses grew +20.28%.
- Operating margin expanded 3.20 percentage points YoY but slipped 0.28 percentage points QoQ as costs grew faster than revenue sequentially.
- Other income contributed 16.58% of pre-tax profit, making the quarter's earnings quality an important consideration.
Price around the results
Revenue momentum lifted Q1FY27 profit
Consolidated revenue grew +25.19% YoY and +17.81% QoQ, while operating profit increased +47.06% YoY. Net profit growth was faster at +56.35% YoY, helped by a 1.90 percentage-point decline in the tax rate to 25.00%. The result was filed after market close, so there was no immediate market reaction to report.
Costs kept the sequential margin under pressure
Year-on-year, revenue grew faster than expenses, supporting a 3.20 percentage-point expansion in operating margin. Sequentially, expenses grew +18.23% against revenue growth of +17.81%, narrowing the margin by 0.28 percentage points. Interest rose only +1.46% QoQ, but other income accounted for 16.58% of pre-tax profit, so reported earnings were not entirely operating-led.
Margin remains above peers despite a two-quarter decline
Operating margin has fallen for a second straight quarter, from 23.50% in Q3FY26 to 21.82% in Q4FY26 and 21.54% in Q1FY27. It remains 5.85 percentage points above the 15.69% median for the 37 Consumer Discretionary peers that have reported the same quarter. The sequential decline contrasts with the clear YoY improvement from 18.34%.
The stock usually reacts negatively after results
There is no post-result move yet because the filing came after market close. Across the last eight results, the stock rose three times and fell five times, with a median absolute move of 3.30%, so a negative reaction has been more common than a positive one in its recent history.
Q1FY27 at a glance
Consolidated figures as filed with NSE — cross-checked against an independent source.
| Line item | Q1FY27 | Q4FY26 | QoQ | YoY |
|---|---|---|---|---|
| Revenue | ₹3,455 cr | ₹2,933 cr | +17.81% | +25.19% |
| Other income | ₹100 cr | ₹-4 cr | — | -6.97% |
| Expenses | ₹2,711 cr | ₹2,293 cr | +18.23% | +20.28% |
| Operating profit | ₹744 cr | ₹640 cr | +16.32% | +47.06% |
| Operating margin (%) | 21.54% | 21.82% | — | — |
| Interest | ₹37 cr | ₹36 cr | +1.46% | +19.42% |
| Depreciation | ₹206 cr | ₹199 cr | +3.72% | +9.61% |
| Profit before tax | ₹601 cr | ₹401 cr | +49.91% | +52.40% |
| Tax | ₹150 cr | ₹101 cr | +48.09% | +41.67% |
| Net profit | ₹451 cr | ₹299 cr | +50.53% | +56.35% |
| EPS (₹) | ₹23.32 | ₹15.49 | +50.55% | +56.41% |
Operating margin of 21.54% compares with a Consumer Discretionary sector median of 15.69% across 37 peers that have reported Q1FY27.
What to watch
- Whether operating margin recovers from 21.54% after two consecutive quarterly declines.
- Whether expense growth stays below revenue growth after the sequential gap of +18.23% versus +17.81%.
- Whether other income remains near its 16.58% share of pre-tax profit.