Carraro India's profit rises, but margin remains below sector median
Revenue and expenses grew almost in line sequentially, while lower tax and other income lifted net profit faster than operating profit.
Filed 06 Nov 2026, 15:24 IST · Carraro India Ltd (CARRARO)
Key takeaways
- Standalone revenue rose +28.19% QoQ while operating margin widened only 0.06 percentage points to 7.90%.
- Net profit increased +35.33% QoQ as the tax rate fell 1.10 percentage points, while other income contributed 29.65% of pre-tax profit.
- Carraro India's 7.90% operating margin was 3.66 percentage points below the 11.56% median for 272 reported Consumer Discretionary peers.
Price around the results
Revenue accelerates as expenses track closely
Standalone revenue rose +28.19% QoQ to Rs 692.42 cr, while expenses increased +28.10% to Rs 637.75 cr. With costs growing slightly slower than revenue, operating profit rose +29.15% and operating margin widened 0.06 percentage points to 7.90%. This was a sequential improvement from 7.84% in Q1FY27, but the change was limited.
Lower tax and other income amplify the profit increase
Net profit grew +35.33% QoQ, faster than the +33.36% increase in pre-tax profit, as the tax rate fell 1.10 percentage points to 24.22%. Other income accounted for 29.65% of pre-tax profit, making it a material contributor to reported earnings. Interest expense also rose +16.20%, partly offsetting the operating profit increase.
Margin stays below the Consumer Discretionary peer median
Carraro India's 7.90% operating margin was 3.66 percentage points below the 11.56% median among 272 Consumer Discretionary peers that have reported. The available quarter-to-quarter direction is modestly positive, with margin moving from 7.84% in Q1FY27 to 7.90% in Q2FY27.
Management outlines Plant 1 expansion
Management said Plant 1 expansion plans include a new assembly line and an incoming-material warehouse of approximately 5,075 square metres. The company also said it holds a 60–65% market share in the non-captive construction vehicle transmission market.
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 | ₹692 cr | ₹540 cr | +28.19% |
| Other income | ₹16 cr | ₹14 cr | +15.68% |
| Expenses | ₹638 cr | ₹498 cr | +28.10% |
| Operating profit | ₹55 cr | ₹42 cr | +29.15% |
| Operating margin (%) | 7.90% | 7.84% | — |
| Interest | ₹5 cr | ₹4 cr | +16.20% |
| Depreciation | ₹11 cr | ₹11 cr | +1.27% |
| Profit before tax | ₹55 cr | ₹41 cr | +33.36% |
| Tax | ₹13 cr | ₹10 cr | +27.62% |
| Net profit | ₹41 cr | ₹31 cr | +35.33% |
| EPS (₹) | ₹7.30 | ₹5.39 | +35.44% |
Operating margin of 7.90% compares with a Consumer Discretionary sector median of 11.56% across 272 peers that have reported Q2FY27.
How the stock reacted
| Window | Stock | vs NIFTY |
|---|---|---|
| Results day | -2.85% | -4.86% |
Volume on the results session was 1.39× its 20-day average.
What management said
From the company’s own investor presentation. Each point is checked against the source document before it appears here.
Expansion
- Plant 1 expansion plans include a new assembly line and an incoming-material warehouse of approximately 5,075 square metres.
Competition
- Carraro India states that it holds a 60–65% market share in the non-captive construction vehicle transmission market.
What to watch
- Whether standalone operating margin remains above 7.90%.
- Whether other income's contribution stays below or above 29.65% of pre-tax profit.
- Progress on management's stated Plant 1 expansion, including the approximately 5,075-square-metre warehouse.