Kaveri Seed’s Q2 margin collapses as company swings to a loss
Revenue fell 67.12% QoQ, but expenses declined only 45.73%, reducing operating margin by 39.33 percentage points.
Filed 28 Oct 2026, 13:45 IST · Kaveri Seed Company Ltd (KSCL)
Key takeaways
- Consolidated operating margin fell 39.33 percentage points QoQ as revenue dropped 67.12% while expenses declined 45.73%.
- Despite Rs 4.92 cr of other income, Kaveri Seed reported a Rs 8.78 cr net loss after depreciation rose 2.97% to Rs 13.86 cr.
- At 0.25%, operating margin was 12.22 percentage points below the 19-peer FMCG median.
Price around the results
Q2 reverses Q1’s profit into a consolidated loss
Kaveri Seed’s consolidated Q2FY27 revenue fell 67.12% QoQ to Rs 244.14 cr, while operating profit fell 99.79% to Rs 0.62 cr. The company moved from Q1FY27 net profit of Rs 279.84 cr to a Rs 8.78 cr loss, with EPS shifting from Rs 54.83 to Rs -1.72. The sharp sequential reversal was concentrated at the operating level.
Costs declined less than revenue, while depreciation kept pressure on profit
Expenses declined 45.73%, substantially less than the 67.12% fall in revenue, driving the 39.33-percentage-point contraction in operating margin. Depreciation rose 2.97% to Rs 13.86 cr and interest increased 10.00% to Rs 0.11 cr, leaving profit before tax at a Rs 8.43 cr loss despite Rs 4.92 cr of other income. Other income represented -58.36% of reported PBT, and the Rs 0.35 cr tax expense meant the negative 4.12% tax rate did not flatter net profit.
Operating margin was the lowest among 19 reported FMCG peers
Kaveri Seed’s 0.25% operating margin was 12.22 percentage points below the 12.47% median for the 19 FMCG peers that had reported the quarter. It ranked first from the bottom on this measure. Sequentially, the margin fell from 39.58% in Q1FY27, marking a sharp negative direction across the available quarter comparison.
Q2FY27 at a glance
Consolidated figures as filed with NSE — cross-checked against an independent source.
| Line item | Q2FY27 | Q1FY27 | QoQ |
|---|---|---|---|
| Revenue | ₹244 cr | ₹743 cr | -67.12% |
| Other income | ₹5 cr | ₹4 cr | +31.90% |
| Expenses | ₹244 cr | ₹449 cr | -45.73% |
| Operating profit | ₹1 cr | ₹294 cr | -99.79% |
| Operating margin (%) | 0.25% | 39.58% | — |
| Interest | ₹0 cr | ₹0 cr | +10.00% |
| Depreciation | ₹14 cr | ₹13 cr | +2.97% |
| Profit before tax | ₹-8 cr | ₹284 cr | — |
| Tax | ₹0 cr | ₹4 cr | -91.63% |
| Net profit | ₹-9 cr | ₹280 cr | — |
| EPS (₹) | ₹-1.72 | ₹54.83 | — |
Operating margin of 0.25% compares with a Fast Moving Consumer Goods sector median of 12.47% across 19 peers that have reported Q2FY27.
What to watch
- Whether revenue recovers from Rs 244.14 cr in the next reported quarter.
- Whether operating margin moves back above 0.25% and narrows the 12.22-percentage-point gap with the peer median.
- Whether tax expense continues alongside a reported PBT loss of Rs 8.43 cr.