Eldeco margin drops 11.38 points as costs outpace revenue
Revenue rose 5.64% sequentially, but expenses grew 24.31% and the tax rate more than doubled, cutting net profit by 51.16%.
Filed 05 Nov 2026, 18:02 IST · after market close · Eldeco Housing & Industries Ltd (ELDEHSG)
Key takeaways
- Consolidated operating margin fell 11.38 percentage points sequentially to 24.16% as expenses grew 24.31%, against 5.64% revenue growth.
- Net profit declined 51.16% sequentially, as the tax rate rose 26.95 percentage points to 42.12% alongside weaker operating profit.
- Management said bookings were moderated without new launches, while Q2 deliveries rose 38.9% in units and 32.0% in area year on year.
Price around the results
Revenue grew, but operating leverage reversed
Consolidated revenue rose 5.64% sequentially to Rs 51.84 cr, but expenses increased 24.31% to Rs 39.32 cr. The resulting cost growth outpaced revenue and reduced operating profit by 28.15%, taking operating margin down 11.38 percentage points to 24.16%. Other income contributed 8.07% of profit before tax, so it was not the main source of reported earnings.
Higher tax rate amplified the profit decline
The tax rate increased 26.95 percentage points to 42.12%, which compounded the 28.35% sequential decline in profit before tax. Interest expense fell 13.64%, so financing costs did not drive the weaker net profit. The tax increase, rather than interest, was the larger below-operating-profit pressure this quarter.
Margin remains above the peer median despite the sequential fall
Operating margin was 12.56 percentage points above the 11.60% median for the 237 Consumer Discretionary peers that had reported the same quarter. The sequential decline from 35.54% in Q1FY27 marks a sharp reversal after the prior quarter, though the available trend covers only these two quarters. The results were filed after market close on 5 November 2026, so there is no post-results market reaction to assess.
Launch pipeline is central to the next phase
Management said booking performance was moderated because there were no new project launches, and that upcoming launches are expected to support sales momentum. It also said the company acquired 9.72 acres in Q2FY27 and is continuing to aggregate land; forthcoming projects comprise 74.0 acres of economic land area and 39,48,718 square feet of saleable area. Q2 deliveries increased 38.9% in units and 32.0% in area year on year, while management said H1 FY27 area booked declined 48.7% year on year.
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 |
|---|---|---|---|
| Revenue | ₹52 cr | ₹49 cr | +5.64% |
| Other income | ₹1 cr | ₹1 cr | -17.60% |
| Expenses | ₹39 cr | ₹32 cr | +24.31% |
| Operating profit | ₹13 cr | ₹17 cr | -28.15% |
| Operating margin (%) | 24.16% | 35.54% | — |
| Interest | ₹1 cr | ₹1 cr | -13.64% |
| Depreciation | ₹0 cr | ₹0 cr | +0.00% |
| Profit before tax | ₹13 cr | ₹18 cr | -28.35% |
| Tax | ₹5 cr | ₹3 cr | +98.89% |
| Net profit | ₹7 cr | ₹15 cr | -51.16% |
| EPS (₹) | ₹7.51 | ₹15.36 | -51.11% |
Operating margin of 24.16% compares with a Consumer Discretionary sector median of 11.60% across 237 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.
This quarter
- Eldeco City Courtyard had sold more than 45% of its area by Q2 FY27.
- Q2 FY27 deliveries rose 38.9% in units and 32.0% in area year on year.
Guidance & outlook
- Upcoming launches are expected to support sales momentum.
- The company has a strong pipeline of upcoming launches and is actively aggregating land for its next growth phase.
- The company expects strong and sustained growth in the years ahead as projects progress towards launch.
Expansion
- The company acquired 9.72 acres during Q2 FY27 to expand its land portfolio for future development.
- The forthcoming projects have a total economic land area of 74.0 acres and saleable area of 39,48,718 square feet.
- The land bank for forthcoming projects under planning totals 67.5 acres.
Problems & risks
- Booking performance was moderated because there were no new project launches.
- H1 FY27 area booked declined 48.7% year on year.
- Shaheed Path and Eldeco Palm Springs were awaiting final approval.
What to watch
- Whether operating margin moves from 24.16% after expenses grew 24.31% sequentially.
- Whether area booked improves from the 48.7% year-on-year decline reported for H1 FY27.
- Progress on the 74.0 acres of forthcoming projects and the 9.72 acres acquired in Q2FY27.