Lloyds Metals margin falls 6.03 pp sequentially despite 55.35% YoY growth
Costs fell less than revenue sequentially, but the year-on-year margin improved as sales grew faster than expenses.
Filed 03 Nov 2026, 19:35 IST · after market close · Lloyds Metals & Energy Ltd (LLOYDSME)
Key takeaways
- Consolidated operating margin fell 6.03 percentage points sequentially to 31.79% as revenue declined faster than expenses.
- Revenue grew 55.35% year on year, while operating profit rose 72.91% as costs grew more slowly than sales.
- Net profit rose 80.34% year on year, helped by a 3.00-percentage-point fall in the tax rate, while other income was only 0.94% of pre-tax profit.
Price around the results
Sequential slowdown follows a strong Q1
Lloyds Metals reported consolidated revenue of Rs 5,672.53 cr in Q2FY27, down 22.87% sequentially but up 55.35% year on year. Operating profit declined 35.16% sequentially, while net profit fell 40.99% to Rs 1,023.24 cr. The year-on-year comparison was stronger: operating profit increased 72.91% and net profit increased 80.34%.
Costs explain the 6.03-point margin reset
Sequentially, expenses declined 15.39%, less than the 22.87% fall in revenue, so operating margin narrowed by 6.03 percentage points. Year on year, expenses rose 48.33%, below the 55.35% revenue increase, lifting margin by 3.22 percentage points. Interest expense was broadly stable sequentially, rising 1.14%, but was up 58.52% year on year.
Margin remains above the commodities peer median
Operating margin has now declined for two consecutive quarters from the 42.28% recorded in Q4FY26, after reaching 37.82% in Q1FY27; it remains 3.22 percentage points above Q2FY26. Lloyds Metals' 31.79% margin was 17.61 percentage points above the 14.18% median for 86 reported commodities peers. Other income contributed only 0.94% of pre-tax profit, so earnings quality was not materially dependent on it.
Management flags demand, mine feed and cost initiatives
Management said domestic demand remained positive, while it reported a shortage of high-grade ore feed at the Surya mines and said high acid and logistics costs constrained copper operations. The company reported Q2FY27 copper production of 1,636 tonnes and said both PB North West coal-handling streams were operational. Management said annual savings could surpass INR 2,000 crore as cost initiatives mature, and its presentation listed a planned 195-kilometre slurry pipeline, a 15 MNT integrated steel plant and renewable capacity scaling to 100 MW, with 120 MW planned.
Results filed after market close
The results were filed after market close, so there is no reported market reaction yet. After the previous eight results, the stock rose on five occasions and fell on three, with a median absolute move of 2.31%.
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 | ₹5,673 cr | ₹7,354 cr | -22.87% | +55.35% |
| Other income | ₹12 cr | ₹161 cr | -92.32% | -77.72% |
| Expenses | ₹3,869 cr | ₹4,573 cr | -15.39% | +48.33% |
| Operating profit | ₹1,804 cr | ₹2,781 cr | -35.16% | +72.91% |
| Operating margin (%) | 31.79% | 37.82% | — | — |
| Interest | ₹279 cr | ₹276 cr | +1.14% | +58.52% |
| Depreciation | ₹226 cr | ₹262 cr | -13.60% | +35.69% |
| Profit before tax | ₹1,311 cr | ₹2,405 cr | -45.49% | +73.40% |
| Tax | ₹288 cr | ₹671 cr | -57.10% | +52.54% |
| Net profit | ₹1,023 cr | ₹1,734 cr | -40.99% | +80.34% |
| EPS (₹) | ₹18.57 | ₹30.68 | -39.47% | +68.21% |
Operating margin of 31.79% compares with a Commodities sector median of 14.18% across 86 peers that have reported Q2FY27.
What management said
From the company’s own investor presentation. Each point is checked against the source document before it appears here.
This quarter
- The company reported copper production of 1,636 tonnes in Q2 FY27.
- Both PB North West coal-handling streams are operational, and FY27 equipment mobilisation was completed on schedule.
Guidance & outlook
- Domestic demand for the company’s products remains strong and positive.
- Annual savings are expected to exceed INR 2,000 crore as cost initiatives mature.
Expansion
- The future project pipeline includes a 195-kilometre slurry pipeline and a 15 MNT integrated steel plant.
- The company is scaling renewable energy to 100 MW, with 120 MW planned.
New initiatives
- The company is developing an in-house electric vehicle conversion capability through its TRC.
Problems & risks
- Surya mines face a shortage of high-grade ore feed from the company’s own mines.
- Copper operations remain constrained by high acid and logistics costs.
What to watch
- Whether operating margin holds above 31.79% after two sequential quarterly declines.
- Whether revenue recovers from Rs 5,672.53 cr while expenses continue to grow more slowly than sales.
- Whether copper production remains above the Q2FY27 level of 1,636 tonnes amid the reported acid, logistics and ore-feed constraints.