Granules India profit rises, but costs push margin lower for a second quarter
Year-on-year earnings benefited from lower interest costs, while sequential margin pressure reflected expenses growing faster than revenue.
Filed 02 Nov 2026, 16:48 IST · after market close · Granules India Ltd (GRANULES)
Key takeaways
- Consolidated net profit rose 39.22% year on year, helped by 20.28% revenue growth and a 28.16% fall in interest costs.
- Sequentially, expenses grew 7.43% against 5.63% revenue growth, narrowing operating margin by 1.31 percentage points to 21.64%.
- Operating margin remained 1.37 percentage points above the 20.27% median for 44 healthcare peers that have reported.
Price around the results
Profit growth was led by operating scale and lower interest
Consolidated revenue increased 20.28% year on year, while expenses grew slightly slower at 19.99%, lifting operating profit by 21.33%. Net profit grew faster at 39.22% because interest costs fell 28.16% and the tax rate eased by 0.44 percentage points. Other income contributed 4.39% of pre-tax profit, so it was not the main source of earnings growth.
Sequential margin pressure returned as costs outpaced sales
Revenue grew 5.63% from Q1FY27, but expenses increased 7.43%, reducing operating margin by 1.31 percentage points. Operating margin has now declined for two consecutive quarters, from 23.94% in Q4FY26 to 22.95% in Q1FY27 and 21.64% in Q2FY27. Interest costs were broadly stable sequentially, falling 0.71%, so the margin decline was primarily at the operating-cost level.
Margin remained above the healthcare peer median
Granules India's 21.64% operating margin was 1.37 percentage points above the 20.27% median among 44 healthcare companies that have reported the quarter. The comparison is positive, but the sequential margin trend has weakened even as revenue continued to grow.
The market reaction is still pending
The results were filed after market close, so no immediate market reaction is assessed. Across the stock's eight recent results reactions, it rose three times and fell five times, with a median absolute move of 2.5%, indicating mixed but typically modest responses.
Q2FY27 at a glance
Consolidated figures as filed with NSE — cross-checked against an independent source.
| Line item | Q2FY27 | Q1FY27 | QoQ | YoY |
|---|---|---|---|---|
| Revenue | ₹1,560 cr | ₹1,477 cr | +5.63% | +20.28% |
| Other income | ₹11 cr | ₹2 cr | +370.93% | — |
| Expenses | ₹1,222 cr | ₹1,138 cr | +7.43% | +19.99% |
| Operating profit | ₹338 cr | ₹339 cr | -0.39% | +21.33% |
| Operating margin (%) | 21.64% | 22.95% | — | — |
| Interest | ₹21 cr | ₹21 cr | -0.71% | -28.16% |
| Depreciation | ₹84 cr | ₹80 cr | +5.29% | +16.44% |
| Profit before tax | ₹243 cr | ₹240 cr | +1.26% | +38.41% |
| Tax | ₹62 cr | ₹60 cr | +1.90% | +36.08% |
| Net profit | ₹182 cr | ₹180 cr | +1.04% | +39.22% |
| EPS (₹) | ₹7.22 | ₹7.26 | -0.55% | +34.20% |
Operating margin of 21.64% compares with a Healthcare sector median of 20.27% across 44 peers that have reported Q2FY27.
What to watch
- Whether operating margin recovers from 21.64% after two consecutive quarterly declines.
- Whether expenses grow slower than revenue after rising 7.43% sequentially against 5.63% revenue growth.
- Whether other income remains a limited contributor after accounting for 4.39% of pre-tax profit.