Loyal Textile turns operating profit positive, but earnings quality remains weak
Revenue outpaced expenses sequentially, yet high interest, depreciation and reliance on other income kept pre-tax profit at Rs 0.36 cr.
Filed 12 Nov 2026, 18:17 IST · after market close · Loyal Textile Mills Ltd (LOYALTEX)
Key takeaways
- Consolidated operating margin recovered 5.15 percentage points QoQ to 2.48%, but remained 8.75 percentage points below the 329-peer sector median.
- Revenue grew +5.36% QoQ while expenses rose only +0.07%, but interest increased +4.39% and depreciation jumped +61.13%.
- Other income was 2194.44% of pre-tax profit, while the -94.44% tax rate also flattered the reported net profit of Rs 0.07 cr.
Price around the results
Operating recovery from Q1FY27 loss
Loyal Textile Mills reported consolidated operating profit of Rs 2.25 cr in Q2FY27, reversing the Rs -2.29 cr loss in Q1FY27. Revenue rose +5.36% QoQ to Rs 90.67 cr while expenses increased only +0.07% to Rs 88.42 cr. That operating improvement lifted the margin by 5.15 percentage points, although net profit was only Rs 0.07 cr.
Interest and depreciation absorbed the operating gain
Interest rose +4.39% QoQ to Rs 5.23 cr, while depreciation increased +61.13% to Rs 4.56 cr, limiting the conversion of operating profit into pre-tax profit. Other income of Rs 7.9 cr represented 2194.44% of pre-tax profit, pointing to a sharp reliance on non-operating income. The tax rate moved from 74.01% to -94.44%, so a tax credit also supported reported net profit.
Margin remains below the Consumer Discretionary peer set
The quarter marked a sequential margin recovery from -2.67% in Q1FY27 to 2.48%, but the margin was 8.75 percentage points below the 11.23% median for 329 Consumer Discretionary peers that had reported. The available quarter sequence therefore shows a reversal from the prior-quarter loss, rather than evidence of a sustained multi-quarter improvement.
Results filed after market close
The consolidated results were filed after market close on 12 Nov 2026. No post-results stock reaction is covered here.
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 |
|---|---|---|---|
| Revenue | ₹91 cr | ₹86 cr | +5.36% |
| Other income | ₹8 cr | ₹9 cr | -11.43% |
| Expenses | ₹88 cr | ₹88 cr | +0.07% |
| Operating profit | ₹2 cr | ₹-2 cr | — |
| Operating margin (%) | 2.48% | -2.67% | — |
| Interest | ₹5 cr | ₹5 cr | +4.39% |
| Depreciation | ₹5 cr | ₹3 cr | +61.13% |
| Profit before tax | ₹0 cr | ₹-1 cr | — |
| Tax | ₹-0 cr | ₹-1 cr | +62.22% |
| Net profit | ₹0 cr | ₹-2 cr | — |
| EPS (₹) | ₹-3.00 | ₹-3.11 | +3.54% |
Operating margin of 2.48% compares with a Consumer Discretionary sector median of 11.23% across 329 peers that have reported Q2FY27.
What to watch
- Whether consolidated operating margin improves from 2.48% after the Q1FY27 loss.
- Whether depreciation moderates from Rs 4.56 cr after rising +61.13% QoQ.
- Whether profit becomes less reliant on other income after its 2194.44% share of pre-tax profit.