Revenue rose 60%, but faster costs and financing charges cut profit
Operating margin fell 7.98 percentage points YoY as expenses outpaced revenue; management cited a Rs 6,778 crore order book for revenue visibility.
Filed 05 Nov 2026, 17:41 IST · after market close · Enviro Infra Engineers Ltd (EIEL)
Key takeaways
- Consolidated revenue grew 60.00% YoY, but expenses rose 77.89%, cutting operating margin by 7.98 percentage points and net profit by 20.22%.
- Interest expense rose 144.37% YoY and the tax rate increased by 7.18 percentage points, while other income contributed 15.11% of pre-tax profit.
- Operating margin at 20.58% was 8.32 percentage points below the 28.90% median for 25 Utilities peers that have reported.
Price around the results
Revenue growth failed to translate into higher profit
Consolidated revenue grew 60.00% YoY to Rs 363.77 cr, but expenses increased 77.89% to Rs 288.91 cr. That cost gap limited operating-profit growth to 15.28%, well below the pace of revenue growth. Pre-tax profit fell 12.18% and net profit fell 20.22% YoY, showing that the larger operating base did not convert into higher earnings.
Costs, interest and tax all weighed on margins
Sequentially, revenue rose 1.28% while expenses grew 1.91%, narrowing operating margin by 0.49 percentage points to 20.58%; YoY, the margin contraction was 7.98 percentage points. Interest expense rose 24.55% QoQ and 144.37% YoY, while depreciation increased 97.19% YoY. The tax rate also rose 7.18 percentage points YoY to 28.72%, and other income accounted for 15.11% of pre-tax profit, making earnings quality an important consideration.
Margin remains below the Utilities peer median
Operating margin improved from 18.70% in Q4FY26 to 21.07% in Q1FY27 before easing to 20.58% in Q2FY27, so the latest decline follows a first-quarter recovery rather than marking a third straight fall. The margin was 8.32 percentage points below the 28.90% median of 25 Utilities peers that have reported the quarter.
Water remains the core business as renewables expand
Management said the Water and Wastewater segment contributed around 71% of consolidated revenue in the quarter, while renewable energy contributed approximately 29% of H1FY27 revenue. The company said its approximately Rs 6,778 crore order book across water infrastructure and renewable energy provides revenue visibility. Management also said three STP projects at Mathura, Yamuna Nagar and Amritsar were in advanced stages of completion, and that Suyog Urja secured a Rs 224.19 crore wind EPC order from Tata Power Renewable Energy.
Results were filed after market close
The results were filed after market close, so there is no post-results market move to assess yet. In the seven prior result reactions, the stock fell six times and rose once, with a median absolute move of 2.31%.
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 | ₹364 cr | ₹359 cr | +1.28% | +60.00% |
| Other income | ₹8 cr | ₹6 cr | +39.27% | -20.21% |
| Expenses | ₹289 cr | ₹284 cr | +1.91% | +77.89% |
| Operating profit | ₹75 cr | ₹76 cr | -1.10% | +15.28% |
| Operating margin (%) | 20.58% | 21.07% | — | — |
| Interest | ₹18 cr | ₹14 cr | +24.55% | +144.37% |
| Depreciation | ₹10 cr | ₹9 cr | +12.74% | +97.19% |
| Profit before tax | ₹55 cr | ₹59 cr | -5.35% | -12.18% |
| Tax | ₹16 cr | ₹13 cr | +19.44% | +17.16% |
| Net profit | ₹39 cr | ₹45 cr | -12.65% | -20.22% |
| EPS (₹) | ₹2.36 | ₹2.27 | +3.96% | -15.11% |
Operating margin of 20.58% compares with a Utilities sector median of 28.90% across 25 peers that have reported Q2FY27.
How the stock reacted
| Window | Stock | vs NIFTY |
|---|---|---|
| Results day | -5.17% | -7.19% |
Volume on the results session was 1.83× 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.
This quarter
- The core Water and Wastewater segment contributed around 71% of consolidated revenue during the quarter.
- The renewable energy vertical contributed approximately 29% of revenues during H1 FY27.
Guidance & outlook
- The company says its approximately Rs 6,778 crore order book provides healthy revenue visibility.
- The company remains confident in its long-term growth opportunities in water infrastructure, renewable energy and energy storage.
Expansion
- The company is in advanced stages of completing three STP projects at Mathura, Yamuna Nagar and Amritsar.
New orders
- Suyog Urja secured a Rs 224.19 crore wind EPC order from Tata Power Renewable Energy.
Problems & risks
- The WSSP project has become relatively insignificant in scale.
What to watch
- Whether operating margin holds above 20.58% after the 0.49-percentage-point sequential decline.
- Whether interest expense growth moderates from 24.55% QoQ.
- Progress on the three STP projects and the revenue contribution from the approximately Rs 6,778 crore order book.