Blue Star margin recovers sequentially, but trails last year's Q2
Revenue grew +21.00% YoY, but faster expense growth cut margin 0.66 percentage points; lower tax and other income lifted net profit.
Filed 29 Oct 2026, 16:16 IST · after market close · Blue Star Ltd (BLUESTARCO)
Key takeaways
- Consolidated revenue grew +21.00% YoY, but expenses grew faster at +21.86%, narrowing operating margin by 0.66 percentage points.
- Net profit rose +25.44% YoY as the tax rate fell 4.03 percentage points, while other income contributed 25.10% of pre-tax profit.
- Operating margin recovered 1.73 percentage points sequentially to 6.91% as expenses fell faster than revenue, down -14.82% versus -13.23%.
Price around the results
Revenue growth did not fully reach operating profit
Blue Star's consolidated revenue grew +21.00% YoY, but operating profit rose only +10.44% because expenses increased faster than sales. Net profit grew +25.44%, helped by a tax rate that fell 4.03 percentage points and other income that rose +337.69% YoY from a low base. Other income accounted for 25.10% of pre-tax profit, so the earnings increase was not entirely operational.
Sequential margin recovery came with lower costs
Quarter on quarter, revenue fell -13.23%, while expenses fell faster at -14.82%, lifting operating margin by 1.73 percentage points. Interest increased +25.09% sequentially, and depreciation rose +19.92%, limiting the benefit from the better cost performance. The 6.91% margin remained 5.83 percentage points below the 12.74% median for 107 Consumer Discretionary peers that had reported, placing Blue Star 24th from the bottom.
Margin recovered from Q1FY27 but remains below Q2FY26
The operating margin improved from 5.18% in Q1FY27 to 6.91% in Q2FY27, after reaching 8.01% in Q4FY26. It was still below the 7.57% recorded in Q2FY26, showing a sequential recovery but a year-on-year decline.
Results came after the close; past reactions have been mostly negative
The consolidated results were filed after market close, so there is no current-session reaction to assess. Across the last eight results reactions, the stock fell six times and rose twice, with a median absolute move of 4.14%. That history gives the next trading session a context of generally negative and material post-results moves.
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 | YoY |
|---|---|---|---|---|
| Revenue | ₹2,931 cr | ₹3,378 cr | -13.23% | +21.00% |
| Other income | ₹39 cr | ₹30 cr | +32.80% | +337.69% |
| Expenses | ₹2,728 cr | ₹3,203 cr | -14.82% | +21.86% |
| Operating profit | ₹203 cr | ₹175 cr | +15.79% | +10.44% |
| Operating margin (%) | 6.91% | 5.18% | — | — |
| Interest | ₹17 cr | ₹13 cr | +25.09% | -0.41% |
| Depreciation | ₹68 cr | ₹57 cr | +19.92% | +56.63% |
| Profit before tax | ₹157 cr | ₹135 cr | +16.87% | +19.01% |
| Tax | ₹33 cr | ₹32 cr | +4.08% | +0.00% |
| Net profit | ₹124 cr | ₹103 cr | +20.88% | +25.44% |
| EPS (₹) | ₹6.03 | ₹4.99 | +20.84% | +25.63% |
Operating margin of 6.91% compares with a Consumer Discretionary sector median of 12.74% across 107 peers that have reported Q2FY27.
What to watch
- Whether operating margin holds above 6.91% after recovering from 5.18% in Q1FY27.
- Whether expenses grow slower than revenue after rising +21.86% versus +21.00% YoY this quarter.
- Whether other income remains near its 25.10% share of pre-tax profit and the tax rate stays below 21.23%.