Godfrey Phillips' operating margin falls to 15.05% in Q1FY27
Revenue declined 18.89% year on year as costs fell more slowly, while other income made up 42.43% of consolidated profit before tax.
Filed 27 Jul 2026, 17:23 IST · after market close · Godfrey Phillips India Ltd (GODFRYPHLP)
Key takeaways
- Revenue fell 18.89% year on year while expenses declined only 10.84%, reducing operating margin by 7.66 percentage points to 15.05%.
- Net profit fell 44.32% year on year, with other income contributing 42.43% of profit before tax.
- Operating margin was 0.93 percentage points below the 15.98% median for six reporting FMCG peers.
Price around the results
Revenue contraction exposed a sharp operating slowdown
Godfrey Phillips India reported consolidated revenue of Rs 1,205.51 cr in Q1FY27, down 18.89% year on year and 32.55% sequentially. Expenses declined 10.84% year on year and 17.05% sequentially, so the smaller fall in costs than revenue drove operating profit down 46.25% year on year and 67.18% sequentially. Net profit consequently fell 44.32% year on year to Rs 198.39 cr.
Margin fell 15.88 percentage points from the March quarter
Operating margin narrowed by 7.66 percentage points year on year and 15.88 percentage points sequentially, as expenses declined more slowly than revenue in both comparisons. Depreciation rose 22.07% year on year, adding to the pressure below operating profit, while interest expense fell 10.69%. The tax rate was broadly stable year on year at a change of 0.52 percentage points, but fell 1.10 percentage points sequentially and provided some support to reported profit.
Q1 margin reversed the improvement seen through FY26
Operating margin had risen from 17.10% in Q4FY25 to 24.38% in Q2FY26 and 30.93% in Q4FY26 before falling to 15.05% in Q1FY27. The quarter's margin was 0.93 percentage points below the 15.98% median of six FMCG peers that had reported, placing the company second from the bottom. Other income of Rs 106.54 cr represented 42.43% of consolidated profit before tax, making earnings quality an important consideration alongside the operating decline.
Results were filed after market close; prior reactions skewed negative
The consolidated results were filed after market close, so there was no immediate market reaction to this quarter's numbers. After the company's previous eight results, the stock rose twice and fell six times, with a median absolute move of 5.00%.
Q1FY27 at a glance
Consolidated figures as filed with NSE — filed ahead of third-party databases, not yet independently cross-checked.
| Line item | Q1FY27 | Q4FY26 | QoQ | YoY |
|---|---|---|---|---|
| Revenue | ₹1,206 cr | ₹1,787 cr | -32.55% | -18.89% |
| Other income | ₹107 cr | ₹151 cr | -29.57% | -24.66% |
| Expenses | ₹1,024 cr | ₹1,235 cr | -17.05% | -10.84% |
| Operating profit | ₹181 cr | ₹553 cr | -67.18% | -46.25% |
| Operating margin (%) | 15.05% | 30.93% | — | — |
| Interest | ₹3 cr | ₹3 cr | -14.24% | -10.69% |
| Depreciation | ₹34 cr | ₹33 cr | +5.15% | +22.07% |
| Profit before tax | ₹251 cr | ₹668 cr | -62.43% | -43.95% |
| Tax | ₹53 cr | ₹148 cr | -64.30% | -42.53% |
| Net profit | ₹198 cr | ₹521 cr | -61.95% | -44.32% |
| EPS (₹) | ₹12.72 | ₹33.43 | -61.95% | -81.44% |
Operating margin of 15.05% compares with a Fast Moving Consumer Goods sector median of 15.98% across 6 peers that have reported Q1FY27.
What to watch
- Whether operating margin recovers from 15.05% after the 15.88-percentage-point sequential decline.
- Whether expenses continue to fall more slowly than revenue after the year-on-year gap of 10.84% versus 18.89%.
- Whether other income remains a large contributor after accounting for 42.43% of profit before tax.