Emami's revenue doubled, but faster cost growth cuts margin
Consolidated operating margin fell 1.27 percentage points YoY as expenses grew faster, while a 26.75% tax rate limited profit conversion.
Filed 05 Nov 2026, 13:50 IST · Emami Ltd (EMAMILTD)
Key takeaways
- Consolidated revenue rose 166.35% YoY, but expenses grew 170.71%, limiting operating-profit growth to 151.22%.
- Operating margin fell 1.27 percentage points YoY to 21.09% as costs grew faster than revenue, extending the decline from Q1FY27.
- Net profit rose 91.74% YoY, but the comparison was flattered by a 1.22% tax rate last year versus 26.75% this quarter.
Price around the results
Revenue growth outpaced by expense growth
Emami's consolidated revenue growth was substantial at 166.35% YoY, but expenses grew faster at 170.71%, so operating profit grew more slowly at 151.22%. The same pattern appeared sequentially: revenue increased 104.66%, against expense growth of 106.43%. This left the quarter's operating margin below the preceding quarter despite the sharp increase in scale.
Margin slipped as tax and financing costs rose
Operating margin declined 1.27 percentage points YoY and 0.67 percentage points QoQ because costs outpaced revenue in both comparisons. Interest expense rose 344.49% YoY and 108.38% QoQ, adding pressure below operating profit. The 26.75% tax rate was 25.53 percentage points above last year's 1.22%, making net-profit growth of 91.74% much slower than pre-tax-profit growth of 158.58%; other income contributed 10.19% of pre-tax profit.
Margin remains above FMCG peer median but below recent peak
Emami's 21.09% operating margin was 9.67 percentage points above the 11.42% median for the 54 Fast Moving Consumer Goods peers that had reported. The quarter marks a sequential decline after the margin improved from 20.18% in Q4FY26 to 21.76% in Q1FY27. It remains well below the 33.36% recorded in Q3FY26, showing that the recent recovery has not continued into Q2FY27.
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 | ₹2,127 cr | ₹1,039 cr | +104.66% | +166.35% |
| Other income | ₹40 cr | ₹17 cr | +134.14% | +102.40% |
| Expenses | ₹1,678 cr | ₹813 cr | +106.43% | +170.71% |
| Operating profit | ₹449 cr | ₹226 cr | +98.29% | +151.22% |
| Operating margin (%) | 21.09% | 21.76% | — | — |
| Interest | ₹12 cr | ₹6 cr | +108.38% | +344.49% |
| Depreciation | ₹88 cr | ₹43 cr | +105.92% | +94.50% |
| Profit before tax | ₹388 cr | ₹195 cr | +99.44% | +158.58% |
| Tax | ₹104 cr | ₹56 cr | +86.28% | +5577.05% |
| Net profit | ₹284 cr | ₹139 cr | +104.72% | +91.74% |
| EPS (₹) | ₹6.45 | ₹3.15 | +104.76% | +89.71% |
Operating margin of 21.09% compares with a Fast Moving Consumer Goods sector median of 11.42% across 54 peers that have reported Q2FY27.
What to watch
- Whether operating margin recovers from 21.09% after the sequential decline.
- Whether expense growth falls below revenue growth after the 106.43% versus 104.66% QoQ gap.
- Whether the tax rate remains near 26.75% and other income stays at 10.19% of pre-tax profit.