Operating margin rebounds, but other income drives 86.29% of PBT
Consolidated Q2FY27 operating performance improved sharply, but the sequential profit decline shows the reported earnings remain tied to non-operating income.
Filed 12 Nov 2026, 16:22 IST · after market close · KCPSUGIND (KCPSUGIND)
Key takeaways
- Consolidated operating margin expanded 7.33 percentage points YoY to 11.65% as revenue grew +16.59% while expenses grew +7.67%.
- Net profit rose to Rs 39.32 cr YoY, but other income contributed 86.29% of pre-tax profit and the tax rate fell 39.46 percentage points to 15.08%.
- QoQ operating margin improved 8.3 percentage points, yet net profit fell -14.98% as other income declined -28.03%.
Operating recovery continues from Q4FY26
Revenue grew +16.59% YoY while expenses rose only +7.67%, lifting operating margin by 7.33 percentage points to 11.65%. Sequentially, revenue was nearly flat at +0.41%, but lower expenses at -8.21% drove an 8.3-percentage-point margin improvement. This extends the operating recovery from the -7.04% margin in Q4FY26 through 3.35% in Q1FY27.
Other income remains the main profit driver
Other income accounted for 86.29% of pre-tax profit, making the Rs 39.32 cr net profit less representative of operating earnings. YoY, the tax rate fell 39.46 percentage points to 15.08%, which also flattered the increase in reported profit. QoQ, other income fell -28.03% and pulled pre-tax profit down -14.53% despite the improvement in operating profit.
Quarterly direction is improving, but earnings quality is uneven
Operating margin has risen for two consecutive quarters after the -7.04% reading in Q4FY26, reaching 11.65% in Q2FY27. The operating trend is therefore better, but the sharp swings in other income—from -Rs 8.91 cr in Q4FY26 to Rs 55.52 cr in Q1FY27 and Rs 39.96 cr in Q2FY27—have made net profit volatile.
Results were filed after market close
The consolidated results were filed after market close on 12 Nov 2026. No market reaction is available yet, so the immediate response cannot be assessed against the stock's past results-day moves.
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 | ₹78 cr | ₹78 cr | +0.41% | +16.59% |
| Other income | ₹40 cr | ₹56 cr | -28.03% | +3202.48% |
| Expenses | ₹69 cr | ₹75 cr | -8.21% | +7.67% |
| Operating profit | ₹9 cr | ₹3 cr | +249.81% | +214.83% |
| Operating margin (%) | 11.65% | 3.35% | — | — |
| Interest | ₹2 cr | ₹3 cr | -39.22% | -8.37% |
| Depreciation | ₹1 cr | ₹1 cr | +2.22% | -20.69% |
| Profit before tax | ₹46 cr | ₹54 cr | -14.53% | +4933.70% |
| Tax | ₹7 cr | ₹8 cr | -11.98% | +1296.00% |
| Net profit | ₹39 cr | ₹46 cr | -14.98% | +9261.90% |
| EPS (₹) | ₹3.47 | ₹4.08 | -14.95% | +8575.00% |
What to watch
- Whether operating margin holds above 11.65% after two consecutive quarters of improvement.
- Whether other income's 86.29% contribution to pre-tax profit declines.
- Whether revenue growth can build on the +16.59% YoY increase after only +0.41% QoQ growth.