Kajaria margin jumps, but shares fall 7% after Q4 results
Filed 30 Apr 2026, 20:32 IST · after market close · Kajaria Ceramics Ltd (KAJARIACER)
Key takeaways
- Consolidated operating margin expanded 7.87 percentage points year on year to 19.19% as revenue grew +12.40% while expenses rose only +2.44%.
- Consolidated net profit increased +262.58% year on year, helped by a tax-rate reduction of 1.65 percentage points to 30.11%.
- The stock fell 7.00% on the first reaction day, far beyond its 2.09% median absolute move after the past eight results.
Price around the results
Q4 revenue growth translated into a sharp margin recovery
Consolidated revenue grew +12.40% year on year, but expenses increased only +2.44%, lifting operating profit growth to +90.42%. Operating margin expanded 7.87 percentage points year on year and rose another 1.97 percentage points sequentially, reversing the decline seen in Q3FY26. Kajaria's 19.19% margin was 4.38 percentage points above the 14.81% median for the 93 Consumer Discretionary peers that had reported.
Profit growth was mainly operational, with limited other-income support
Other income contributed 3.80% of consolidated pre-tax profit, so it was not a large driver of the quarter's profit increase; it also fell -56.25% year on year. The tax rate declined 1.65 percentage points year on year and 0.74 percentage points sequentially, which added to net-profit growth. Interest expense fell -4.51% year on year, while depreciation declined -2.53%.
Margin improved for the second straight quarter
Operating margin rose from 17.22% in Q3FY26 to 19.19% in Q4FY26, after increasing from 16.95% in Q1FY26 to 18.00% in Q2FY26. This marks a recovery from 11.32% in Q4FY25 rather than a continuation of the prior quarter's decline. Sequentially, revenue grew +17.56% and expenses grew +14.77%, allowing operating profit to increase +30.96%.
The market reaction was unusually negative
The stock fell 7.00% on 4 May, with a 2.31 times volume ratio, and was down 10.55% after one trading day. That reaction was much larger than the stock's 2.09% median absolute move after its past eight results, during which it rose three times and fell five times. The shares remained down 7.76% after five trading days and 9.91% after 15 trading days.
Q4FY26 at a glance
Consolidated figures as filed with NSE — cross-checked against an independent source.
| Line item | Q4FY26 | Q3FY26 | QoQ | YoY |
|---|---|---|---|---|
| Revenue | ₹1,373 cr | ₹1,168 cr | +17.56% | +12.40% |
| Other income | ₹9 cr | ₹-29 cr | — | -56.25% |
| Expenses | ₹1,110 cr | ₹967 cr | +14.77% | +2.44% |
| Operating profit | ₹263 cr | ₹201 cr | +30.96% | +90.42% |
| Operating margin (%) | 19.19% | 17.22% | — | — |
| Interest | ₹6 cr | ₹6 cr | -3.70% | -4.51% |
| Depreciation | ₹42 cr | ₹42 cr | +2.02% | -2.53% |
| Profit before tax | ₹224 cr | ₹125 cr | +79.14% | +106.60% |
| Tax | ₹67 cr | ₹39 cr | +74.84% | +95.87% |
| Net profit | ₹157 cr | ₹86 cr | +81.73% | +262.58% |
| EPS (₹) | ₹9.78 | ₹5.51 | +77.50% | +266.29% |
Operating margin of 19.19% compares with a Consumer Discretionary sector median of 14.81% across 93 peers that have reported Q4FY26.
How the stock reacted
| Window | Stock | vs NIFTY |
|---|---|---|
| Results day | -7.00% | -7.51% |
| Next session | -10.55% | — |
| 5 sessions | -7.76% | -7.00% |
| 15 sessions | -9.91% | — |
| 30 sessions | -4.09% | — |
Volume on the results session was 2.31× its 20-day average.
What to watch
- Whether consolidated operating margin holds above 19.19% after its 1.97-percentage-point sequential increase.
- Whether expense growth remains below revenue growth, which was +2.44% versus +12.40% year on year in Q4FY26.
- Whether the tax rate stays near or below 30.11% without a larger contribution from other income than its 3.80% share of pre-tax profit.