Cummins India margin falls to 15.34% as costs outpace revenue
Revenue rose 4.13% year on year, but operating profit fell 27.13% as expenses grew faster and other income declined 22.86%.
Filed 04 Nov 2026, 22:38 IST · after market close · Cummins India Ltd (CUMMINSIND)
Key takeaways
- Standalone operating margin fell 6.58 percentage points year on year to 15.34% as expenses rose 12.90% against 4.13% revenue growth.
- Net profit declined 26.78% year on year to Rs 466.89 cr, despite the tax rate falling 1.74 percentage points.
- Other income contributed 25.21% of profit before tax, making the quarter's earnings less reliant on operations.
Price around the results
Profit fell despite modest revenue growth
These standalone results show revenue rising 4.13% year on year, but operating profit falling 27.13% and net profit declining 26.78%. Sequentially, revenue fell 3.64% and net profit dropped 14.02%, indicating weaker profit conversion even after the previous quarter's higher sales base. Lower interest expense did not offset the pressure on operating profit.
Costs drove the margin compression
Expenses rose 12.90% year on year against 4.13% revenue growth, cutting operating margin by 6.58 percentage points. Sequentially, expenses declined only 0.53% while revenue fell 3.64%, leading to a further 2.64-percentage-point margin decline. Other income fell 22.86% year on year and accounted for 25.21% of profit before tax, while the 1.74-percentage-point reduction in the tax rate partly softened the net-profit decline.
Margin is still above peers but has declined for two quarters
Cummins India's 15.34% operating margin was 3.09 percentage points above the 12.25% median for 146 Industrials peers that had reported the quarter. The margin has declined for two consecutive quarters, from 21.33% in Q4FY26 to 17.98% in Q1FY27 and 15.34% in Q2FY27. This is the lowest operating margin in the five-quarter trend shown.
No market reaction yet after the late filing
The standalone results were filed after market close, so there is no current trading reaction to assess. After the previous eight results, the stock rose six times and fell twice, with a median absolute move of 3.62%.
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 | YoY |
|---|---|---|---|---|
| Revenue | ₹3,301 cr | ₹3,426 cr | -3.64% | +4.13% |
| Other income | ₹151 cr | ₹161 cr | -5.97% | -22.86% |
| Expenses | ₹2,795 cr | ₹2,810 cr | -0.53% | +12.90% |
| Operating profit | ₹506 cr | ₹616 cr | -17.83% | -27.13% |
| Operating margin (%) | 15.34% | 17.98% | — | — |
| Interest | ₹3 cr | ₹4 cr | -23.08% | +17.65% |
| Depreciation | ₹54 cr | ₹53 cr | +2.55% | +9.66% |
| Profit before tax | ₹601 cr | ₹721 cr | -16.64% | -28.43% |
| Tax | ₹134 cr | ₹178 cr | -24.65% | -33.61% |
| Net profit | ₹467 cr | ₹543 cr | -14.02% | -26.78% |
| EPS (₹) | ₹16.84 | ₹19.59 | -14.04% | -26.78% |
Operating margin of 15.34% compares with a Industrials sector median of 12.25% across 146 peers that have reported Q2FY27.
What to watch
- Whether operating margin stabilises above 15.34% after two consecutive sequential declines.
- Whether expense growth moves closer to revenue growth after rising 12.90% year on year against 4.13% revenue growth.
- Whether other income remains a major contributor after accounting for 25.21% of profit before tax.