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
- Consolidated net profit fell 44.32% year on year as revenue declined 18.89% and operating margin narrowed 7.66 percentage points.
- Other income accounted for 42.43% of consolidated profit before tax, making reported earnings less reflective of operating performance.
- The stock fell 8.11% on the first trading day, a larger move than its 5.00% median absolute reaction after the last eight results.
Price around the results
Q1FY27 earnings contracted sharply
Godfrey Phillips India reported consolidated net profit down 44.32% year on year, with operating profit falling 46.25%. Revenue declined 18.89%, and the sequential drop was steeper at 32.55%, reversing the contribution from the previous quarter. The results were filed after market close.
Costs drove the margin reversal
Year on year, expenses fell 10.84%, less than the 18.89% revenue decline, so operating margin narrowed 7.66 percentage points. Sequentially, revenue fell 32.55% while expenses declined 17.05%, producing a 15.88-percentage-point margin contraction from Q4FY26. The 1.10-percentage-point sequential decline in the tax rate partly cushioned the impact on net profit, while the year-on-year tax rate rose 0.52 percentage points.
Operating margin trails the reported peer median
Operating margin was 15.05%, 1.09 percentage points below the 16.14% median for 34 Fast Moving Consumer Goods peers that had reported the quarter. The margin had risen to 30.93% in Q4FY26 after 20.78% in Q3FY26, so Q1 marked a sharp reversal rather than a third consecutive quarterly decline. Other income contributed 42.43% of profit before tax, a material share of reported earnings.
Initial stock reaction was worse than usual
The stock fell 8.11% on the first trading day after the results, including a 3.31% opening gap, and remained down 6.08% the next day. Its eight-result history shows six declines and two rises, with a median absolute move of 5.00%, making the initial reaction larger than usual. By the fifth trading day, the stock was up 5.72% from the reaction anchor, although the reaction series is not complete.
Q1FY27 at a glance
Consolidated figures as filed with NSE — cross-checked against an independent source.
| 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 16.14% across 34 peers that have reported Q1FY27.
How the stock reacted
| Window | Stock | vs NIFTY |
|---|---|---|
| Results day | -8.11% | -8.06% |
| Next session | -6.08% | — |
| 5 sessions | +5.72% | +3.14% |
Volume on the results session was 10.44× its 20-day average.
What to watch
- Whether consolidated operating margin recovers from 15.05% after the 15.88-percentage-point sequential decline.
- Whether the 18.89% year-on-year revenue decline narrows in the next reported quarter.
- Whether other income remains close to 42.43% of profit before tax.