ITI's Q4 profit came from other income as operating margin slipped
Revenue rose QoQ, but costs grew faster; the stock's 1.97% first-session decline was in line with its usual post-results direction.
Filed 02 Jun 2026, 22:48 IST · after market close · ITI Ltd (ITI)
Key takeaways
- Consolidated Q4FY26 net profit of Rs 436.1 cr was driven by other income equal to 108.34% of pre-tax profit.
- Revenue grew 21.96% QoQ, but expenses grew 22.79%, narrowing operating margin by 0.65 percentage points.
- ITI's 4.27% operating margin was 15.32 percentage points below the 19.59% median of seven telecom peers.
Price around the results
Q4 profit was largely non-operating
ITI reported consolidated net profit of Rs 436.1 cr in Q4FY26, versus a loss of Rs 25.33 cr in Q3FY26. The swing was driven by other income of Rs 472.47 cr, which accounted for 108.34% of pre-tax profit. The zero tax rate also meant the full pre-tax profit flowed through to net profit.
Revenue growth did not prevent margin slippage
Revenue increased 21.96% QoQ, but expenses grew faster at 22.79%, reducing operating margin by 0.65 percentage points to 4.27%. Operating profit rose only 5.84%, despite the higher revenue base. Interest expense fell 4.64%, but depreciation increased 61.22%, adding to the pressure below the operating line.
Margin improved from losses but remains lowest among peers
Operating margin has improved from -0.22% in Q2FY26 to 4.92% in Q3FY26 and 4.27% in Q4FY26, so the latest quarter interrupted the prior improvement. ITI ranked lowest on operating margin among the seven telecom companies that had reported, trailing the sector median by 15.32 percentage points.
The stock reaction matched its usual direction
The stock fell 1.97% in the first session after the result, after moving -0.33% at the initial reaction point, and was up 0.20% by five sessions. That response was close to the stock's median absolute post-results move of 2.2%; across eight recent results, it fell seven times and rose once.
Q4FY26 at a glance
Consolidated figures as filed with NSE — cross-checked against an independent source.
| Line item | Q4FY26 | Q3FY26 | QoQ |
|---|---|---|---|
| Revenue | ₹628 cr | ₹515 cr | +21.96% |
| Other income | ₹472 cr | ₹8 cr | +5813.27% |
| Expenses | ₹601 cr | ₹489 cr | +22.79% |
| Operating profit | ₹27 cr | ₹25 cr | +5.84% |
| Operating margin (%) | 4.27% | 4.92% | — |
| Interest | ₹45 cr | ₹48 cr | -4.64% |
| Depreciation | ₹18 cr | ₹11 cr | +61.22% |
| Profit before tax | ₹436 cr | ₹-25 cr | — |
| Tax | ₹0 cr | ₹0 cr | — |
| Net profit | ₹436 cr | ₹-25 cr | — |
| EPS (₹) | ₹4.53 | ₹-0.26 | — |
Operating margin of 4.27% compares with a Telecommunication sector median of 19.59% across 7 peers that have reported Q4FY26.
How the stock reacted
| Window | Stock | vs NIFTY |
|---|---|---|
| Results day | -0.33% | +1.17% |
| Next session | -1.97% | — |
| 5 sessions | +0.20% | +2.46% |
| 15 sessions | +3.67% | — |
| 30 sessions | -3.60% | — |
Volume on the results session was 2.86× its 20-day average.
What to watch
- Whether operating margin recovers from 4.27% after the 0.65-percentage-point QoQ decline.
- Whether revenue growth exceeds expense growth after the latest 21.96% versus 22.79% comparison.
- Whether profit remains supported by other income after its 108.34% share of pre-tax profit.