Expenses outpace revenue as Medico’s operating margin slips
Standalone revenue grew 6.59% sequentially, but higher costs, interest and tax pushed net profit down 5.56%.
Filed 09 Nov 2026, 17:32 IST · after market close · Medico Remedies Ltd (MEDICO)
Key takeaways
- Standalone net profit fell 5.56% quarter on quarter to Rs 2.38 cr despite revenue growth of 6.59%.
- Operating margin narrowed by 0.48 percentage points to 4.28% as expenses grew 7.13%, faster than revenue.
- Other income contributed 40.06% of pre-tax profit, while the Healthcare peer median operating margin was 21.66% across 87 companies.
Price around the results
Revenue growth did not translate into profit growth
On a standalone basis, revenue rose 6.59% quarter on quarter to Rs 73.97 cr, but operating profit fell 3.94% and net profit fell 5.56% to Rs 2.38 cr. Sales momentum therefore did not carry through to earnings.
Higher costs and tax rate squeezed margins
Expenses grew 7.13% quarter on quarter, outpacing revenue growth of 6.59%, and operating margin narrowed by 0.48 percentage points to 4.28%. Interest expense also rose 9.76%, while the tax rate increased by 2.66 percentage points to 27.26%. Other income accounted for 40.06% of pre-tax profit, giving reported earnings a meaningful non-operating contribution.
Margin remains far below Healthcare peers
Medico’s 4.28% standalone operating margin was 17.38 percentage points below the 21.66% median for 87 Healthcare peers that had reported the quarter. It ranked fifth from the bottom on this measure.
Sequential margin decline, with results filed after close
Operating margin moved down from 4.76% in Q1FY27 to 4.28% in Q2FY27, while net profit declined from Rs 2.52 cr to Rs 2.38 cr. The results were filed after market close, so there is no market reaction to assess in this update.
Q2FY27 at a glance
Standalone figures as filed with NSE — cross-checked against an independent source.
| Line item | Q2FY27 | Q1FY27 | QoQ |
|---|---|---|---|
| Revenue | ₹74 cr | ₹69 cr | +6.59% |
| Other income | ₹1 cr | ₹1 cr | +11.97% |
| Expenses | ₹71 cr | ₹66 cr | +7.13% |
| Operating profit | ₹3 cr | ₹3 cr | -3.94% |
| Operating margin (%) | 4.28% | 4.76% | — |
| Interest | ₹0 cr | ₹0 cr | +9.76% |
| Depreciation | ₹1 cr | ₹1 cr | +4.17% |
| Profit before tax | ₹3 cr | ₹3 cr | -2.10% |
| Tax | ₹1 cr | ₹1 cr | +8.54% |
| Net profit | ₹2 cr | ₹3 cr | -5.56% |
| EPS (₹) | ₹0.29 | ₹0.30 | -3.33% |
Operating margin of 4.28% compares with a Healthcare sector median of 21.66% across 87 peers that have reported Q2FY27.
What to watch
- Whether standalone operating margin recovers from 4.28%.
- Whether expense growth remains below the 7.13% recorded this quarter.
- Whether other income remains close to 40.06% of pre-tax profit.