Profit falls -8.00% despite a 0.11-point margin gain
Revenue grew faster than expenses, but lower other income and higher interest costs reduced pre-tax profit and net profit.
Filed 02 Nov 2026, 23:07 IST · after market close · Happiest Minds Technologies Ltd (HAPPSTMNDS)
Key takeaways
- Consolidated net profit fell -8.00% sequentially to Rs 62.19 cr even as operating margin rose 0.11 percentage points.
- Revenue grew +2.69% sequentially while expenses rose +2.55%, lifting operating profit by +3.30%.
- Other income contributed 19.85% of pre-tax profit, while interest expense increased +8.43% sequentially.
Price around the results
Margin improved, but profit declined
Happiest Minds’ consolidated revenue rose +2.69% sequentially, while expenses increased +2.55%, allowing operating profit to grow +3.30%. That pushed operating margin up 0.11 percentage points to 18.82%. Net profit nevertheless fell -8.00% as costs below operating profit increased.
Interest and other income shaped the quarter
Interest expense rose +8.43% sequentially, while other income declined -30.01% to Rs 16.58 cr. Other income still represented 19.85% of pre-tax profit, making it a material contributor to reported earnings quality. The tax rate also increased 0.49 percentage points to 25.55%, adding to the pressure on net profit.
Margin sits below the IT peer median
The 18.82% operating margin was 0.56 percentage points below the 19.38% median for 44 IT peers that had reported the quarter, placing Happiest Minds 21st from the bottom. Across the two quarters shown, margin moved up from 18.71% in Q1FY27 to 18.82% in Q2FY27. The company filed these consolidated results after market close on 02 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 | ₹645 cr | ₹629 cr | +2.69% |
| Other income | ₹17 cr | ₹24 cr | -30.01% |
| Expenses | ₹524 cr | ₹511 cr | +2.55% |
| Operating profit | ₹121 cr | ₹118 cr | +3.30% |
| Operating margin (%) | 18.82% | 18.71% | — |
| Interest | ₹31 cr | ₹28 cr | +8.43% |
| Depreciation | ₹24 cr | ₹23 cr | +4.60% |
| Profit before tax | ₹84 cr | ₹90 cr | -7.39% |
| Tax | ₹21 cr | ₹23 cr | -5.58% |
| Net profit | ₹62 cr | ₹68 cr | -8.00% |
| EPS (₹) | ₹4.13 | ₹4.49 | -8.02% |
Operating margin of 18.82% compares with a Information Technology sector median of 19.38% across 44 peers that have reported Q2FY27.
What to watch
- Whether revenue growth remains ahead of expense growth after the +2.69% versus +2.55% sequential comparison.
- Whether operating margin holds above 18.82% in the next quarter.
- Whether interest expense moderates from its +8.43% sequential increase and other income remains a material contributor to pre-tax profit.