Revenue rose 27.43%, but costs pushed margin down to 19.47%
Management cited 43% material costs, aggressive pricing and higher logistics costs; operating margin has declined for three straight quarters.
Filed 03 Nov 2026, 18:59 IST · after market close · Inox India Ltd (INOXINDIA)
Key takeaways
- Consolidated revenue rose +27.43% YoY to Rs 456.48 cr, but expenses grew +31.17%, narrowing operating margin by 2.29 percentage points.
- Operating margin fell to 19.47%, down 2.29 percentage points YoY and 0.99 percentage points QoQ, as material cost reached 43% of revenue.
- Net profit rose +9.40% YoY to Rs 66.56 cr, while other income contributed 12.22% of pre-tax profit.
Price around the results
Large-tank dispatches supported growth, but pricing diluted it
Consolidated revenue grew +27.43% YoY and +23.11% QoQ, while operating profit increased more slowly at +13.98% YoY. Management said large tanks for Bahamas and aerospace applications were dispatched during the quarter, but aggressive pricing and higher logistics costs linked to geopolitical disruptions affected growth. The company also secured its largest-ever single order from a global aerospace company for an LOX/LNG subcooler.
Material and logistics costs drove the margin squeeze
Expenses grew +31.17% YoY against revenue growth of +27.43%, reducing operating margin by 2.29 percentage points. Management said material cost rose to 43% of revenue from 40.5% in Q2FY26, while higher logistics costs and sales commissions on large tanks also lifted other expenses. Other income fell -15.56% YoY but still accounted for 12.22% of pre-tax profit; the QoQ tax-rate increase of 1.87 percentage points also limited the conversion of pre-tax profit into net profit.
Margin remains above peers but is falling each quarter
In Industrials, Inox India's 19.47% operating margin was 7.98 percentage points above the 11.49% median for 103 reporting peers. However, margin has declined for three consecutive quarters, from 21.95% in Q3FY26 to 20.55% in Q4FY26, 20.46% in Q1FY27 and 19.47% in Q2FY27.
Savli capacity and Brazil assets lifted depreciation
Management said depreciation increased after the new cryogenic and non-cryogenic tank manufacturing facility at Savli was capitalised, along with leased trailers in Brazil capitalised in the second half of the previous year. The company told analysts it had agreed with Wayout to explore freshwater infrastructure systems for the Asian market. Management also cited a PNGRB estimate that LNG-fuelled trucks could rise from 50,000 in 2030 to 500,000 in 2040.
No post-results move yet after the after-close filing
The consolidated results were filed after market close, so there is no post-results share-price reaction to assess yet. Across eight prior result reactions, the stock rose four times and fell four times, with a median absolute move of 1.39%.
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 | ₹456 cr | ₹371 cr | +23.11% | +27.43% |
| Other income | ₹11 cr | ₹11 cr | +0.37% | -15.56% |
| Expenses | ₹368 cr | ₹295 cr | +24.65% | +31.17% |
| Operating profit | ₹89 cr | ₹76 cr | +17.12% | +13.98% |
| Operating margin (%) | 19.47% | 20.46% | — | — |
| Interest | ₹1 cr | ₹2 cr | -33.96% | -47.50% |
| Depreciation | ₹10 cr | ₹10 cr | +3.89% | +29.53% |
| Profit before tax | ₹89 cr | ₹76 cr | +17.48% | +9.37% |
| Tax | ₹22 cr | ₹18 cr | +26.96% | +9.24% |
| Net profit | ₹67 cr | ₹58 cr | +14.62% | +9.40% |
| EPS (₹) | ₹7.32 | ₹6.40 | +14.37% | +9.25% |
Operating margin of 19.47% compares with a Industrials sector median of 11.49% across 103 peers that have reported Q2FY27.
What management said
From the company’s own investor presentation. Each point is checked against the source document before it appears here.
This quarter
- Large tanks for Bahamas and aerospace applications were dispatched during the quarter.
Guidance & outlook
- PNGRB estimates LNG-fuelled trucks could increase from 50,000 in 2030 to 500,000 in 2040.
Expansion
- INOX capitalised a new cryogenic and non-cryogenic tank manufacturing facility at Savli.
- Leased trailers in Brazil were capitalised during the second half of the previous year.
New orders
- The company secured its largest-ever single order from a global aerospace company for an LOX/LNG subcooler.
New initiatives
- INOX agreed with Wayout to explore freshwater infrastructure systems for the Asian market.
Problems & risks
- Growth was affected by aggressive pricing to boost volume and higher logistics costs caused by geopolitical disruptions.
- Material cost was 43% of revenue in Q2 FY27, up from 40.5% in Q2 FY26.
- Other expenses rose mainly because of higher logistics costs and sales commissions on large tanks dispatched during the quarter.
- EBITDA margin declined to 21.3% from 24.3% year on year.
What to watch
- Whether operating margin holds above 19.47% after three consecutive quarterly declines.
- Whether material cost moves back toward the 40.5% recorded in Q2FY26.
- Whether other income remains close to its 12.22% share of pre-tax profit.