Revenue growth lifted profit, but costs cut operating margin to 18.62%
The consolidated margin declined both year on year and sequentially as expenses grew faster than revenue, while other income contributed 13.6% of pre-tax profit.
Filed 16 Oct 2026, 18:19 IST · after market close · Himadri Speciality Chemical Ltd (HSCL)
Key takeaways
- Consolidated revenue grew 57.93% year on year, but expenses grew faster at 64.21%, narrowing operating margin by 3.11 percentage points to 18.62%.
- Net profit rose 31.33% year on year to Rs 231.32 cr despite an 87.55% increase in interest expense.
- Sequentially, revenue increased 18.13% while expenses rose 20.32%, cutting operating margin by 1.49 percentage points after its Q1 recovery.
Price around the results
Revenue growth outpaced profit growth
On a consolidated basis, revenue growth was substantial, but it did not translate proportionately into profit because expenses expanded faster than sales. The result was a 31.33% year-on-year increase in net profit, well below the 57.93% growth in revenue. Sequentially, revenue rose 18.13%, while net profit increased only 1.27%.
Higher costs and interest weighed on margins
Expenses grew 64.21% year on year against 57.93% revenue growth, narrowing operating margin by 3.11 percentage points; the sequential margin decline was 1.49 percentage points for the same reason. Interest expense rose 87.55% year on year and 23.69% sequentially, adding pressure below operating profit. Other income accounted for 13.6% of pre-tax profit, so reported earnings were not entirely operating-led.
Margin remains below the earlier run-rate
Operating margin has stayed below 21% for the past four quarters, and Q2FY27's 18.62% followed a rebound to 20.11% in Q1FY27. The year-on-year tax rate declined by 0.8 percentage points, which provided some support to net profit, while the sequential tax rate increased by 0.74 percentage points.
Stock reaction is still pending
The company filed its consolidated results after market close, so the immediate stock response is not yet reflected. Across eight previous result reactions, the stock rose four times and fell four times, with a median absolute move of 2.26%.
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 | YoY |
|---|---|---|---|---|
| Revenue | ₹1,691 cr | ₹1,432 cr | +18.13% | +57.93% |
| Other income | ₹42 cr | ₹56 cr | -25.79% | +16.31% |
| Expenses | ₹1,376 cr | ₹1,144 cr | +20.32% | +64.21% |
| Operating profit | ₹315 cr | ₹288 cr | +9.40% | +35.30% |
| Operating margin (%) | 18.62% | 20.11% | — | — |
| Interest | ₹28 cr | ₹22 cr | +23.69% | +87.55% |
| Depreciation | ₹22 cr | ₹21 cr | +1.83% | +24.73% |
| Profit before tax | ₹307 cr | ₹301 cr | +2.27% | +29.93% |
| Tax | ₹76 cr | ₹72 cr | +5.47% | +25.86% |
| Net profit | ₹231 cr | ₹228 cr | +1.27% | +31.33% |
| EPS (₹) | ₹4.60 | ₹4.55 | +1.10% | +28.49% |
What to watch
- Whether operating margin recovers from 18.62% after the 1.49-percentage-point sequential decline.
- Whether expenses continue to grow faster than revenue after rising 20.32% versus 18.13% sequentially.
- Whether other income remains around its 13.6% share of pre-tax profit.