KEI's Q4 margin improved as dealer sales drove 19.27% growth
Costs grew slower than revenue and the tax rate eased, but other income remained a meaningful part of pre-tax profit.
Filed 04 May 2026, 21:20 IST · after market close · KEI Industries Ltd (KEI)
Key takeaways
- Consolidated revenue grew 19.27% year on year, helped by 29.28% growth in dealer and distribution sales, while operating margin expanded 0.64 percentage points.
- Net profit rose 25.50% year on year as the tax rate fell 1.14 percentage points, although other income contributed 11.36% of pre-tax profit.
- The stock fell 0.79% on the results day, a milder move than its 2.65% median absolute reaction after the past eight results.
Price around the results
Dealer-led growth lifted Q4 operating profit
KEI Industries reported consolidated revenue growth of 19.27% year on year in Q4FY26, with operating profit growing faster at 26.66%. Management said sales through the dealer and distribution market increased 29.28% year on year, making that channel a key contributor to the quarter's growth. Sequentially, revenue also rose 17.66% and operating profit increased 19.22%, indicating a sharper finish to the year.
Slower expense growth supported margin expansion
Expenses grew 18.42% year on year against 19.27% revenue growth, which expanded operating margin by 0.64 percentage points; sequentially, the margin improved by 0.15 percentage points as revenue growth slightly outpaced expenses. Below operating profit, interest expense rose 35.52% and depreciation increased 47.34% year on year, limiting the conversion into pre-tax profit. Net profit growth was also aided by a 1.14 percentage-point reduction in the tax rate.
Margin recovered, but remained below the Industrials peer median
Operating margin improved from 9.88% in Q2FY26 to 10.83% in Q3FY26 and 10.98% in Q4FY26, extending the recovery after the Q2 low rather than marking a third consecutive decline. However, KEI's margin was 4.68 percentage points below the 15.66% median among 71 Industrials companies that had reported the quarter. The company stood 19th from the bottom on this measure.
Other income supported profit quality while the stock reaction stayed mixed
Other income accounted for 11.36% of pre-tax profit, so reported earnings included a material non-operating contribution alongside the operating improvement. The stock opened 2.14% lower and closed down 0.79% on the results day, with volume at 4.57 times normal, before returning 1.86% ahead of the sector over five sessions. Its longer reaction was uneven: the stock rose after two of the past eight results and fell after six, while the median absolute move was 2.65%.
Q4FY26 at a glance
Consolidated figures as filed with NSE — cross-checked against an independent source.
| Line item | Q4FY26 | Q3FY26 | QoQ | YoY |
|---|---|---|---|---|
| Revenue | ₹3,476 cr | ₹2,955 cr | +17.66% | +19.27% |
| Other income | ₹43 cr | ₹34 cr | +26.78% | +15.50% |
| Expenses | ₹3,095 cr | ₹2,635 cr | +17.47% | +18.42% |
| Operating profit | ₹382 cr | ₹320 cr | +19.22% | +26.66% |
| Operating margin (%) | 10.98% | 10.83% | — | — |
| Interest | ₹19 cr | ₹17 cr | +13.11% | +35.52% |
| Depreciation | ₹28 cr | ₹23 cr | +26.02% | +47.34% |
| Profit before tax | ₹377 cr | ₹315 cr | +19.86% | +23.59% |
| Tax | ₹93 cr | ₹80 cr | +16.33% | +18.10% |
| Net profit | ₹284 cr | ₹235 cr | +21.06% | +25.50% |
| EPS (₹) | ₹29.74 | ₹24.57 | +21.04% | +25.43% |
Operating margin of 10.98% compares with a Industrials sector median of 15.66% across 71 peers that have reported Q4FY26.
How the stock reacted
| Window | Stock | vs NIFTY |
|---|---|---|
| Results day | -0.79% | -0.43% |
| Next session | +1.79% | — |
| 5 sessions | -1.21% | +1.86% |
| 15 sessions | +4.89% | — |
| 30 sessions | +11.57% | — |
Volume on the results session was 4.57× its 20-day average.
What management said
From the company’s own investor presentation. Each point is checked against the source document before it appears here.
This quarter
- Dealer and distribution market sales increased 29.28% year on year in Q4 FY26.
What to watch
- Whether operating margin holds above 10.98% after the Q4 recovery.
- Whether dealer and distribution sales growth remains near the reported 29.28%.
- Whether other income stays below or above its 11.36% share of pre-tax profit.