Revenue rose 13.36% YoY, but operating margin fell to 15.02%
Expenses grew faster than sales, while net profit fell 20.05%; the margin was still slightly above the Industrials peer median.
Filed 06 Aug 2026, 17:12 IST · after market close · Kirloskar Oil Engines Ltd (KIRLOSENG)
Key takeaways
- Consolidated revenue grew 13.36% YoY, but expenses rose 18.24%, cutting operating margin by 3.5 percentage points.
- Net profit fell 20.05% YoY to Rs 111.06 cr as weaker margins and lower other income outweighed a 16.81% decline in interest costs.
- Operating margin at 15.02% was 0.82 percentage points above the 14.2% median for 67 Industrials peers that had reported.
Price around the results
Sales growth did not convert into profit growth
Kirloskar Oil Engines' consolidated revenue rose 13.36% YoY but net profit declined 20.05% to Rs 111.06 cr. The sequential picture also weakened, with revenue down 5.51% and net profit down 28.45% from Q4FY26.
Faster cost growth compressed the operating margin
Expenses grew 18.24% YoY against 13.36% revenue growth, reducing operating margin by 3.5 percentage points. Sequentially, revenue fell 5.51% while expenses declined only 2.38%, cutting margin by a further 2.73 percentage points. Interest costs fell 16.81% YoY, but other income was down 56.17% and accounted for 10.07% of pre-tax profit, making earnings quality an important consideration. The tax rate was broadly unchanged, rising by 0.08 percentage points YoY.
Margin is below the FY26 peak but above the peer median
The 15.02% operating margin was below 19.59% in Q2FY26 and 17.75% in Q4FY26; Q4's slight recovery was followed by another decline in Q1FY27. Among 67 Industrials companies that had reported, Kirloskar Oil Engines stood 0.82 percentage points above the 14.2% sector median.
No post-results market reaction has been recorded yet
The consolidated results were filed after market close, so there is no market reaction to assess yet. Across the last eight result reactions, the stock was up four times and down four times, with a median absolute move of 4.19%.
Q1FY27 at a glance
Consolidated figures as filed with NSE — cross-checked against an independent source.
| Line item | Q1FY27 | Q4FY26 | QoQ | YoY |
|---|---|---|---|---|
| Revenue | ₹2,000 cr | ₹2,116 cr | -5.51% | +13.36% |
| Other income | ₹15 cr | ₹4 cr | +334.57% | -56.17% |
| Expenses | ₹1,699 cr | ₹1,741 cr | -2.38% | +18.24% |
| Operating profit | ₹300 cr | ₹376 cr | -20.03% | -8.06% |
| Operating margin (%) | 15.02% | 17.75% | — | — |
| Interest | ₹116 cr | ₹120 cr | -3.29% | -16.81% |
| Depreciation | ₹49 cr | ₹49 cr | -1.30% | +22.31% |
| Profit before tax | ₹151 cr | ₹210 cr | -28.06% | -17.14% |
| Tax | ₹40 cr | ₹55 cr | -26.95% | -16.87% |
| Net profit | ₹111 cr | ₹155 cr | -28.45% | -20.05% |
| EPS (₹) | ₹7.82 | ₹10.91 | -28.32% | -19.96% |
Operating margin of 15.02% compares with a Industrials sector median of 14.20% across 67 peers that have reported Q1FY27.
How the stock reacted
| Window | Stock | vs NIFTY |
|---|---|---|
| Results day | -3.89% | -3.62% |
Volume on the results session was 3.53× its 20-day average.
What to watch
- Whether consolidated operating margin recovers from 15.02%.
- Whether expenses grow more slowly than revenue after the 18.24% YoY rise in Q1FY27.
- Whether other income remains around 10.07% of pre-tax profit.