GSFC margin falls as costs outpace revenue, while other income lifts profit
Consolidated net profit rose +26.30% sequentially, but operating margin trailed the commodity-sector median by 11.68 percentage points.
Filed 02 Nov 2026, 18:04 IST · after market close · Gujarat State Fertilizers & Chemicals Ltd (GSFC)
Key takeaways
- Consolidated operating margin fell 3.54 percentage points to 2.95% as expenses grew +37.33%, faster than revenue at +32.31% sequentially.
- Net profit rose +26.30% sequentially despite a -39.97% fall in operating profit, with other income contributing 71.86% of profit before tax.
- GSFC's 2.95% operating margin was 11.68 percentage points below the 14.63% median for 75 reported commodity peers, placing it seventh from the bottom.
Price around the results
Higher revenue did not translate into operating leverage
In consolidated Q2FY27, revenue grew +32.31% sequentially, but expenses rose faster at +37.33%, narrowing operating margin by 3.54 percentage points to 2.95%. Operating profit fell -39.97% despite the higher revenue, pointing to cost pressure during the quarter. This was a marked deterioration from the 6.49% margin reported in Q1FY27.
Other income drove the rise in reported profit
Net profit increased +26.30% sequentially even as operating profit declined -39.97%. Other income accounted for 71.86% of profit before tax, making non-operating income a major contributor to reported earnings. The tax rate fell 3.06 percentage points to 19.66%, partly cushioning the operating decline, while interest expense increased +45.14%.
Margin sits near the bottom of reported commodity peers
GSFC's 2.95% operating margin was 11.68 percentage points below the 14.63% median among 75 commodity peers that had reported the same quarter, ranking seventh from the bottom. The consolidated results were filed after market close on 2 Nov 2026.
Q2FY27 at a glance
Consolidated figures as filed with NSE — filed ahead of third-party databases, not yet independently cross-checked.
| Line item | Q2FY27 | Q1FY27 | QoQ |
|---|---|---|---|
| Revenue | ₹4,741 cr | ₹3,583 cr | +32.31% |
| Other income | ₹179 cr | ₹37 cr | +388.20% |
| Expenses | ₹4,601 cr | ₹3,350 cr | +37.33% |
| Operating profit | ₹140 cr | ₹233 cr | -39.97% |
| Operating margin (%) | 2.95% | 6.49% | — |
| Interest | ₹15 cr | ₹10 cr | +45.14% |
| Depreciation | ₹55 cr | ₹54 cr | +1.31% |
| Profit before tax | ₹249 cr | ₹205 cr | +21.50% |
| Tax | ₹49 cr | ₹47 cr | +5.17% |
| Net profit | ₹200 cr | ₹159 cr | +26.30% |
| EPS (₹) | ₹5.02 | ₹3.98 | +26.13% |
Operating margin of 2.95% compares with a Commodities sector median of 14.63% across 75 peers that have reported Q2FY27.
What to watch
- Whether operating margin improves from 2.95% after the 3.54-percentage-point sequential decline.
- Expense growth relative to the +32.31% sequential increase in revenue.
- Whether other income remains a large contributor compared with its 71.86% share of profit before tax.