Negative tax rate lifts Indian Terrain's Q2 profit above pre-tax earnings
Standalone operating margin of 8.99% trailed the sector median by 2.24 points, while interest and depreciation compressed operating profit before tax.
Filed 12 Nov 2026, 12:30 IST · Indian Terrain Fashions Ltd (INDTERRAIN)
Key takeaways
- Standalone operating margin was 8.99%, 2.24 percentage points below the 11.23% median for 329 reported Consumer Discretionary peers.
- Net profit of Rs 5.09 cr exceeded pre-tax profit of Rs 2.93 cr because the reported tax rate was -73.72%.
- Interest of Rs 4.66 cr and depreciation of Rs 2.82 cr reduced operating profit of Rs 9.58 cr to pre-tax profit of Rs 2.93 cr.
Price around the results
Operating margin trails Consumer Discretionary peers
Indian Terrain reported a standalone operating margin of 8.99%, which was 2.24 percentage points below the 11.23% median among 329 Consumer Discretionary companies that had reported the quarter. The gap points to weaker operating conversion than the sector comparison set, even before financing and tax effects.
Interest and depreciation narrowed the profit bridge
Interest of Rs 4.66 cr and depreciation of Rs 2.82 cr absorbed a substantial part of the Rs 9.58 cr operating profit, leaving profit before tax at Rs 2.93 cr. Other income contributed Rs 0.83 cr, so the reported pre-tax result was not entirely operating in origin.
Negative tax rate is the main earnings-quality caveat
The reported tax rate of -73.72% turned profit before tax of Rs 2.93 cr into net profit of Rs 5.09 cr. That tax benefit, rather than operating performance alone, was central to the quarter's net-profit outcome.
Q2FY27 at a glance
Standalone figures as filed with NSE — filed ahead of third-party databases, not yet independently cross-checked.
| Line item | Q2FY27 |
|---|---|
| Revenue | ₹107 cr |
| Other income | ₹1 cr |
| Expenses | ₹97 cr |
| Operating profit | ₹10 cr |
| Operating margin (%) | 8.99% |
| Interest | ₹5 cr |
| Depreciation | ₹3 cr |
| Profit before tax | ₹3 cr |
| Tax | ₹-2 cr |
| Net profit | ₹5 cr |
| EPS (₹) | ₹1.00 |
Operating margin of 8.99% compares with a Consumer Discretionary sector median of 11.23% across 329 peers that have reported Q2FY27.
What to watch
- Whether operating margin moves above or below 8.99%.
- Whether the tax rate moves back from -73.72% toward a normal charge.
- Whether interest remains near Rs 4.66 cr relative to operating profit.