DLF's operating margin falls to 1.83% as other income drives profit
Revenue fell 23.28% YoY while other income rose 21.37%, offsetting a sharp drop in operating profit.
Filed 16 Oct 2026, 18:19 IST · after market close · DLF Ltd (DLF)
Key takeaways
- Operating margin fell 15.43 percentage points YoY to 1.83% as expenses declined 8.97% but revenue fell 23.28%.
- Net profit rose 10.28% YoY, but other income accounted for 102.22% of pre-tax profit and the tax rate fell 5.58 percentage points.
- Margin has declined for two straight quarters, from 22.64% in Q4FY26 to 11.74% in Q1FY27 and 1.83% in Q2FY27.
Price around the results
Operating profit weakened despite lower expenses
DLF's consolidated revenue fell 23.28% YoY, while expenses declined 8.97%; the smaller fall in costs was not enough to offset the revenue decline. Operating profit therefore dropped 91.88% and operating margin narrowed 15.43 percentage points to 1.83%. Sequentially, revenue fell 1.54% while expenses rose 9.51%, driving a further 9.91 percentage-point margin decline.
Reported profit was led by other income
Other income rose 21.37% YoY and was equal to 102.22% of pre-tax profit, making reported earnings substantially different from the operating result. Lower interest expense, down 71.13% YoY, also supported pre-tax profit, while the tax rate fell 5.58 percentage points to 13.39%. This helped net profit rise 10.28% even as operating profit fell sharply.
Margin now trails 17 reported sector peers
DLF's 1.83% operating margin was 7.77 percentage points below the 9.6% median for the 17 Consumer Discretionary peers that had reported the quarter, placing it third from the bottom. The sequential decline follows a rise from 13.40% in Q1FY26 to 22.64% in Q4FY26, followed by falls to 11.74% in Q1FY27 and 1.83% in Q2FY27.
No immediate market reaction after the late filing
The results were filed after market close, so the stock reaction is not yet covered here. After the previous eight results, the stock rose four times and fell four times, with a median absolute move of 2.61%, indicating no consistent direction after results.
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 | ₹1,261 cr | ₹1,280 cr | -1.54% | -23.28% |
| Other income | ₹1,536 cr | ₹811 cr | +89.38% | +21.37% |
| Expenses | ₹1,238 cr | ₹1,130 cr | +9.51% | -8.97% |
| Operating profit | ₹23 cr | ₹150 cr | -84.68% | -91.88% |
| Operating margin (%) | 1.83% | 11.74% | — | — |
| Interest | ₹18 cr | ₹18 cr | +3.41% | -71.13% |
| Depreciation | ₹38 cr | ₹35 cr | +8.71% | +29.32% |
| Profit before tax | ₹1,503 cr | ₹909 cr | +65.38% | +3.17% |
| Tax | ₹201 cr | ₹115 cr | +75.47% | -27.17% |
| Net profit | ₹1,301 cr | ₹794 cr | +63.92% | +10.28% |
| EPS (₹) | ₹5.25 | ₹3.21 | +63.55% | +10.06% |
Operating margin of 1.83% compares with a Consumer Discretionary sector median of 9.60% across 17 peers that have reported Q2FY27.
What to watch
- Whether operating margin improves from 1.83% after two consecutive quarterly declines.
- Whether expenses continue to grow faster than revenue after rising 9.51% QoQ against a 1.54% revenue decline.
- Whether other income remains above 102.22% of pre-tax profit and the tax rate stays near 13.39%.