Paradeep Phosphates posts 53.43% profit growth, but margins trail peers
Sequential margins recovered as revenue grew faster than expenses, while higher interest costs and weaker cost absorption weighed on the year-on-year comparison.
Filed 28 Jul 2026, 17:57 IST · after market close · Paradeep Phosphates Ltd (PARADEEP)
Key takeaways
- Revenue grew 63.14% YoY, but expenses grew 64.35%, narrowing operating margin by 0.65 percentage points to 11.76%.
- Quarter-on-quarter profit growth was helped by a 2.35-percentage-point margin recovery, a 15.67% fall in interest and a 16.00% fall in depreciation.
- Operating margin at 11.76% was 6.96 percentage points below the 18.72% median of 22 reported commodity-sector peers.
Price around the results
Profit growth lagged the revenue surge
Paradeep Phosphates reported consolidated net profit growth of 53.43% YoY against revenue growth of 63.14%, as expenses grew faster than sales and operating margin narrowed by 0.65 percentage points. Sequentially, net profit rose 152.28% as revenue grew 30.25% and expenses grew 26.87%, lifting operating margin by 2.35 percentage points. Lower interest and depreciation also supported the quarter-on-quarter pre-tax profit increase, even as the tax rate rose by 2.36 percentage points.
Margin recovered from Q4 but remains below peers
The operating margin improved from 8.22% in Q3FY26 to 9.41% in Q4FY26 and 11.76% in Q1FY27, reversing the earlier decline. The year-on-year pressure remains visible because expenses grew 64.35%, faster than revenue at 63.14%; interest was also up 51.80% YoY. The company’s margin was 6.96 percentage points below the 18.72% median for 22 commodity-sector peers that had reported, placing it fourth from the bottom.
Other income was material, but tax did not flatter profit
Other income contributed 8.23% of pre-tax profit, so a meaningful portion of earnings came outside operations. The tax rate was 25.40%, up from 25.15% YoY and 23.04% sequentially, providing no tax-rate benefit to the reported profit growth. The results were filed after market close, so there is no market reaction yet; after the last eight results, the stock rose five times and fell three times, with a median absolute move of 6.09%.
Q1FY27 at a glance
Consolidated figures as filed with NSE — cross-checked against an independent source.
| Line item | Q1FY27 | Q4FY26 | QoQ | YoY |
|---|---|---|---|---|
| Revenue | ₹6,124 cr | ₹4,702 cr | +30.25% | +63.14% |
| Other income | ₹43 cr | ₹42 cr | +3.81% | +61.48% |
| Expenses | ₹5,404 cr | ₹4,260 cr | +26.87% | +64.35% |
| Operating profit | ₹720 cr | ₹442 cr | +62.79% | +54.60% |
| Operating margin (%) | 11.76% | 9.41% | — | — |
| Interest | ₹132 cr | ₹156 cr | -15.67% | +51.80% |
| Depreciation | ₹106 cr | ₹126 cr | -16.00% | +64.87% |
| Profit before tax | ₹526 cr | ₹202 cr | +160.24% | +53.92% |
| Tax | ₹134 cr | ₹47 cr | +186.86% | +55.41% |
| Net profit | ₹393 cr | ₹156 cr | +152.28% | +53.43% |
| EPS (₹) | ₹3.78 | ₹1.50 | +152.00% | +20.38% |
Operating margin of 11.76% compares with a Commodities sector median of 18.72% across 22 peers that have reported Q1FY27.
What to watch
- Whether operating margin holds above 11.76% after the Q1FY27 recovery.
- Whether expenses grow slower than revenue, following 64.35% expense growth versus 63.14% revenue growth YoY.
- Whether other income remains near its 8.23% share of pre-tax profit.