Kalpataru's profit rises 46% YoY as interest costs fall
Operating margin improved as costs grew slower than revenue, but other income formed 18.36% of pre-tax profit.
Filed 11 Aug 2026, 14:26 IST · Kalpataru Projects International Ltd (KPIL)
Key takeaways
- Consolidated net profit grew 45.85% YoY, helped by a 32.82% fall in interest costs and sharply higher other income.
- Operating margin expanded 0.26 percentage points YoY as expenses grew 3.54% against 3.84% revenue growth.
- Other income contributed 18.36% of pre-tax profit, making the quarter's earnings quality a watchpoint.
Price around the results
Profit growth outpaced the 3.84% revenue increase
Kalpataru Projects International's consolidated revenue grew 3.84% YoY, while operating profit rose 7.01% because expenses increased more slowly, at 3.54%. Profit before tax grew 44.88% as interest costs fell 32.82%, although revenue declined 17.61% sequentially in the seasonally weaker quarter. Net profit consequently fell 27.65% QoQ, with pre-tax profit down 17.77%.
Margin improved, but tax and other income affected earnings quality
Operating margin expanded 0.26 percentage points YoY and 0.54 percentage points QoQ because expenses grew slower than revenue on both comparisons. The sequential tax rate rose 10.12 percentage points to 25.91%, which made net profit decline faster than pre-tax profit. Other income accounted for 18.36% of pre-tax profit, so the reported profit growth was not entirely operating-led.
Margin recovery continues, but Kalpataru trails its Industrials peers
Operating margin moved from 7.61% in Q4FY25 to 8.51% in Q1FY26, 8.60% in Q2FY26, 7.70% in Q3FY26, 8.23% in Q4FY26 and 8.77% now, showing a recovery after the Q3 dip. Against 99 Industrials peers that have reported, Kalpataru's margin was 5.43 percentage points below the 14.20% median and ranked 21st from the bottom.
Project execution drove growth, while water collections remained a constraint
Management said B&F revenue growth in Q1FY27 came from project progress and a favourable project mix, while Saudi project execution improved Oil & Gas revenue. The company told analysts that T&D growth continued despite international supply-chain constraints, but said water-business execution remained slow because of lower collections in JJM projects. Management also said it had secured its first Middle East water-treatment and supply project and had solar-installation initiatives at all sites and plants; its presentation cited expected global T&D investment growth from USD 631 billion in 2024 to USD 1.1 trillion by 2050.
Past result-day moves have been evenly split
Across eight past results reactions, the stock rose four times and fell four times, with a median absolute move of 2.53%. That history points to a mixed response pattern rather than a consistent direction after earnings.
Q1FY27 at a glance
Consolidated figures as filed with NSE — filed ahead of third-party databases, not yet independently cross-checked.
| Line item | Q1FY27 | Q4FY26 | QoQ | YoY |
|---|---|---|---|---|
| Revenue | ₹6,408 cr | ₹7,778 cr | -17.61% | +3.84% |
| Other income | ₹77 cr | ₹103 cr | -24.94% | +372.17% |
| Expenses | ₹5,846 cr | ₹7,138 cr | -18.10% | +3.54% |
| Operating profit | ₹562 cr | ₹640 cr | -12.24% | +7.01% |
| Operating margin (%) | 8.77% | 8.23% | — | — |
| Interest | ₹82 cr | ₹105 cr | -21.67% | -32.82% |
| Depreciation | ₹137 cr | ₹127 cr | +7.51% | +5.78% |
| Profit before tax | ₹420 cr | ₹511 cr | -17.77% | +44.88% |
| Tax | ₹109 cr | ₹81 cr | +34.91% | +42.16% |
| Net profit | ₹312 cr | ₹431 cr | -27.65% | +45.85% |
| EPS (₹) | ₹18.16 | ₹25.42 | -28.56% | +45.16% |
Operating margin of 8.77% compares with a Industrials sector median of 14.20% across 99 peers that have reported Q1FY27.
What management said
From the company’s own investor presentation. Each point is checked against the source document before it appears here.
This quarter
- B&F revenue growth was driven by robust project progress and a favorable project mix in Q1 FY27.
- Oil & Gas revenue improved in Q1 FY27 due to execution in a Saudi project.
Guidance & outlook
- Annual global T&D investment is expected to increase from USD 631 billion in 2024 to USD 1.1 trillion by 2050.
Expansion
- The company secured its first water treatment and supply project in the Middle East.
New initiatives
- The company has solar installation initiatives at all its sites and plants.
Problems & risks
- T&D revenue growth occurred despite supply-chain constraints in international markets.
- Water-business execution remained slow because of lower collections in JJM projects.
What to watch
- Whether consolidated revenue rebuilds from Rs 6,407.97 cr while operating margin remains near 8.77%.
- Other income's contribution relative to 18.36% of pre-tax profit.
- The tax rate versus 25.91% after its 10.12-percentage-point sequential increase.