Garware Hi-Tech's Q4 margin rebounds to 22.70% as revenue jumps QoQ
Revenue grew faster than expenses, reversing the previous quarter's margin contraction, while lower taxes and other income also supported reported profit.
Filed 06 May 2026, 13:17 IST · Garware Hi Tech Films Ltd (GRWRHITECH)
Key takeaways
- Q4 consolidated operating margin widened 7.38 percentage points QoQ as revenue growth of +30.07% outpaced expense growth of +18.73%.
- Net profit rose +39.09% YoY, but the 24.00% tax rate was 4.51 percentage points lower and other income supplied 14.84% of pre-tax profit.
- The stock's +12.66% results-day move exceeded its 7.90% median absolute reaction across eight recent results.
Price around the results
Q4 revenue recovery lifted consolidated operating profit
Garware Hi-Tech Films reported a sharp sequential recovery in its consolidated business, with revenue growth of +30.07% translating into operating-profit growth of +92.77%. Expenses grew +18.73%, well below revenue growth, allowing operating margin to recover by 7.38 percentage points from Q3FY26. On a YoY basis, revenue rose +8.90% while expenses increased +4.00%, supporting a 3.64-percentage-point margin improvement.
Lower tax and other income amplified the profit increase
Net profit grew +39.09% YoY, faster than the +29.67% rise in operating profit. The tax rate fell 4.51 percentage points to 24.00%, which flattered the increase in reported net profit. Other income accounted for 14.84% of pre-tax profit, so earnings quality also reflected a material non-operating contribution; interest expense was nearly unchanged YoY, rising +0.46%.
Margin rebound puts the company above the Industrials peer median
The 22.70% operating margin was 7.04 percentage points above the 15.66% median for the 71 Industrials companies that had reported the quarter. The result reversed a two-quarter decline from 22.14% in Q1FY26 to 20.97% in Q2FY26 and 15.32% in Q3FY26. The YoY comparison is also favourable, with margin up 3.64 percentage points.
Management points to specialty films and the SCF expansion
Management said it is targeting 15–20% revenue CAGR and a 22–25% EBITDA margin for value-added specialty films, with export share above 70% and value-added products contributing above 85%. The company said its newly announced Sun Control Film line is expected to strengthen future growth and that the line is scheduled for commissioning in Q1FY28. Management also described the external environment as extremely challenging and said momentum had been sustained despite those pressures.
Results-day reaction was larger than the stock's usual move
The stock rose +12.66% on the results date, with a +11.42% move relative to the benchmark. That was above its 7.90% median absolute reaction across eight recent results, during which it rose seven times and fell once. The shares were up +21.76% at the next recorded session.
Q4FY26 at a glance
Consolidated figures as filed with NSE — cross-checked against an independent source.
| Line item | Q4FY26 | Q3FY26 | QoQ | YoY |
|---|---|---|---|---|
| Revenue | ₹597 cr | ₹459 cr | +30.07% | +8.90% |
| Other income | ₹21 cr | ₹16 cr | +28.29% | +24.88% |
| Expenses | ₹461 cr | ₹388 cr | +18.73% | +4.00% |
| Operating profit | ₹135 cr | ₹70 cr | +92.77% | +29.67% |
| Operating margin (%) | 22.70% | 15.32% | — | — |
| Interest | ₹2 cr | ₹2 cr | +17.74% | +0.46% |
| Depreciation | ₹12 cr | ₹12 cr | +1.96% | +15.73% |
| Profit before tax | ₹142 cr | ₹73 cr | +94.76% | +30.84% |
| Tax | ₹34 cr | ₹17 cr | +97.12% | +10.15% |
| Net profit | ₹108 cr | ₹56 cr | +94.03% | +39.09% |
| EPS (₹) | ₹46.58 | ₹24.01 | +94.00% | +39.09% |
Operating margin of 22.70% compares with a Industrials sector median of 15.66% across 71 peers that have reported Q4FY26.
How the stock reacted
| Window | Stock | vs NIFTY |
|---|---|---|
| Results day | +12.66% | +11.42% |
| Next session | +21.76% | — |
| 5 sessions | +18.65% | +21.23% |
| 15 sessions | +28.34% | — |
| 30 sessions | +46.85% | — |
Volume on the results session was 12.84× its 20-day average.
What management said
From the company’s own investor presentation. Each point is checked against the source document before it appears here.
Guidance & outlook
- The company targets 15–20% revenue CAGR and 22–25% EBITDA margin for its value-added specialty films.
- The company targets export share above 70% and value-added products contributing above 85%.
- The newly announced Sun Control Film line is expected to strengthen future growth.
Expansion
- The SCF line is scheduled for commissioning in Q1FY28.
- The company plans an SCF line estimated for June 2028.
Competition
- The company states that Chinese and Korean players mainly dominate the economy segment.
Problems & risks
- The company reported sustaining momentum despite external pressures.
- The company described the external environment as extremely challenging.
What to watch
- Whether consolidated operating margin holds above 22.70% after the 7.38-percentage-point QoQ rebound.
- Whether other income's 14.84% share of pre-tax profit declines as operating earnings remain the main profit driver.
- Progress against management's stated targets of export share above 70%, value-added products above 85%, and SCF commissioning in Q1FY28.