Ester margin slips as costs outpace revenue; profit falls 57.89% QoQ
Revenue grew 2.68%, but lower other income and faster expense growth pulled operating margin down 2.34 percentage points.
Filed 03 Nov 2026, 13:49 IST · Ester Industries Ltd (ESTER)
Key takeaways
- Consolidated revenue rose 2.68% QoQ, but expenses grew 5.39%, cutting operating margin by 2.34 percentage points to 9.13%.
- Net profit fell 57.89% QoQ to Rs 7.84 cr as other income declined 51.55% and represented 45.90% of pre-tax profit.
- The stock fell 2.25% on results day and underperformed the market by 3.83%, with volume at 1.19 times the usual level.
Price around the results
Revenue growth did not translate into operating profit
Ester Industries reported consolidated revenue growth of 2.68% QoQ in Q2FY27, but operating profit declined 18.23%. Expenses grew 5.39%, faster than revenue, which reduced operating margin by 2.34 percentage points to 9.13%.
Lower other income amplified the profit decline
Other income fell 51.55% QoQ to Rs 4.53 cr, while interest expense was broadly unchanged, rising 0.59% to Rs 17.19 cr. Other income contributed 45.90% of pre-tax profit, making the 58.05% decline in pre-tax profit to Rs 9.87 cr more dependent on non-operating income. The tax rate declined by 0.31 percentage points to 20.58%, but this was not enough to offset the operating and other-income pressure.
Margin trails the Industrials peer median
The 9.13% operating margin was 1.90 percentage points below the 11.03% median for 108 Industrials peers that had reported the same quarter. Sequentially, this was a second-quarter comparison against Q1FY27, when margin was 11.47%, marking a decline of 2.34 percentage points.
Shares fell after the results
Ester shares declined 2.25% on the results date and lagged the market by 3.83%. Trading volume was 1.19 times the usual level, indicating higher-than-normal activity around the filing.
Q2FY27 at a glance
Consolidated figures as filed with NSE — cross-checked against an independent source.
| Line item | Q2FY27 | Q1FY27 | QoQ |
|---|---|---|---|
| Revenue | ₹444 cr | ₹432 cr | +2.68% |
| Other income | ₹5 cr | ₹9 cr | -51.55% |
| Expenses | ₹403 cr | ₹383 cr | +5.39% |
| Operating profit | ₹41 cr | ₹50 cr | -18.23% |
| Operating margin (%) | 9.13% | 11.47% | — |
| Interest | ₹17 cr | ₹17 cr | +0.59% |
| Depreciation | ₹18 cr | ₹18 cr | -1.64% |
| Profit before tax | ₹10 cr | ₹24 cr | -58.05% |
| Tax | ₹2 cr | ₹5 cr | -58.74% |
| Net profit | ₹8 cr | ₹19 cr | -57.89% |
| EPS (₹) | ₹0.75 | ₹1.84 | -59.24% |
Operating margin of 9.13% compares with a Industrials sector median of 11.03% across 108 peers that have reported Q2FY27.
How the stock reacted
| Window | Stock | vs NIFTY |
|---|---|---|
| Results day | -2.25% | -3.83% |
Volume on the results session was 1.19× its 20-day average.
What to watch
- Whether operating margin recovers from 9.13% after expenses grew 5.39% QoQ.
- Whether other income remains a large contributor after accounting for 45.90% of Q2FY27 pre-tax profit.
- Whether interest expense stays near Rs 17.19 cr in the next quarter.