E2E's 76.63% operating margin comes before heavy depreciation
The company reported Rs 72.70 cr of consolidated net profit as it expanded its GPU base and outlined plans for 1,024+ B200 GPUs.
Filed 16 Oct 2026, 13:58 IST · E2E Networks Ltd (E2E)
Key takeaways
- Consolidated operating margin was 76.63%, but Rs 73.97 cr of depreciation and Rs 10.30 cr of interest reduced profit before tax to Rs 97.13 cr.
- Net profit was Rs 72.70 cr after a 25.14% tax rate, while other income contributed Rs 9.93 cr to earnings.
- E2E said it has deployed nearly 3,000 Hopper and 1,024 Blackwell GPUs, and plans to deploy 1,024+ B200 GPUs.
Price around the results
High operating profit, lower pre-tax conversion
E2E's consolidated operating profit of Rs 171.46 cr did not flow through to pre-tax profit in full: Rs 73.97 cr of depreciation and Rs 10.30 cr of interest absorbed much of the difference. Other income of Rs 9.93 cr partly offset those charges, so earnings included a non-operating contribution. Tax at 25.14% left net profit at Rs 72.70 cr.
E2E's margin was well above reported IT peers
The 76.63% operating margin was 58.84 percentage points above the 17.79% median for the nine Information Technology peers that had reported. The comparison highlights the company’s unusually high operating profitability, but the depreciation charge remains a material factor between operating profit and pre-tax profit.
GPU deployment remains the expansion theme
Management said GPU demand for AI training and inference continues to exceed hyperscale capacity. The company told investors that it had deployed nearly 3,000 Hopper and 1,024 Blackwell GPUs, while its presentation said 1,024+ B200 GPUs are planned. These statements connect the reported operating profile with an ongoing expansion of sovereign compute capacity.
Q2FY27 at a glance
Consolidated figures as filed with NSE — filed ahead of third-party databases, not yet independently cross-checked.
| Line item | Q2FY27 |
|---|---|
| Revenue | ₹224 cr |
| Other income | ₹10 cr |
| Expenses | ₹52 cr |
| Operating profit | ₹171 cr |
| Operating margin (%) | 76.63% |
| Interest | ₹10 cr |
| Depreciation | ₹74 cr |
| Profit before tax | ₹97 cr |
| Tax | ₹24 cr |
| Net profit | ₹73 cr |
| EPS (₹) | ₹3.54 |
Operating margin of 76.63% compares with a Information Technology sector median of 17.79% across 9 peers that have reported Q2FY27.
What management said
From the company’s own investor presentation. Each point is checked against the source document before it appears here.
Guidance & outlook
- E2E plans to deploy 1,024+ B200 GPUs.
Expansion
- E2E has deployed nearly 3,000 Hopper and 1,024 Blackwell GPUs.
Problems & risks
- GPU demand for AI training and inference continues to exceed hyperscale capacity.
What to watch
- Whether operating margin holds at or above 76.63% while depreciation remains a major charge.
- Whether the tax rate stays near 25.14% in the next reported quarter.
- Progress against management's stated plan to deploy 1,024+ B200 GPUs.