P N Gadgil’s margin edges up but remains below the sector median
Revenue growth slightly exceeded expense growth, but higher interest costs and other income remained important to the quarter’s profit outcome.
Filed 29 Oct 2026, 15:28 IST · P N Gadgil Jewellers Ltd (PNGJL)
Key takeaways
- Consolidated revenue rose 10.50% QoQ while expenses grew 10.24%, lifting operating margin by 0.22 percentage points.
- Net profit increased 14.98% QoQ to Rs 121.11 cr, although other income contributed 10.58% of pre-tax profit.
- Interest expense rose 22.87% QoQ, outpacing the 13.73% increase in operating profit.
Price around the results
Revenue growth narrowly outpaced costs in Q2FY27
For the consolidated business, revenue grew 10.50% QoQ and expenses rose 10.24%, allowing operating profit to increase 13.73%. Pre-tax profit rose 15.61%, while the 0.41 percentage-point increase in the tax rate limited net-profit growth to 14.98%.
Margin improved, but profit quality needs attention
Operating margin widened by 0.22 percentage points because revenue grew slightly faster than expenses. Interest expense increased 22.87% QoQ, faster than operating profit, and other income represented 10.58% of pre-tax profit. That makes the quarter’s earnings less dependent on operations than the net-profit growth alone suggests.
Margin moved up from Q1 but trails 107-sector peer median
Operating margin improved from 7.56% in Q1FY27 to 7.78% in Q2FY27, reversing some of the pressure visible in the prior quarter. It was 4.96 percentage points below the 12.74% median among 107 Consumer Discretionary peers that had reported, placing P N Gadgil 30th from the bottom.
Management highlighted company-owned expansion and Silvostyle
Management said all seven stores in its expansion states are company-owned, with presence across Uttar Pradesh, Madhya Pradesh, Bihar and Haryana. The presentation said the Silvostyle acquisition was completed on 1 October 2026 and described a five-step market-entry process and a mix of franchise-owned and company-operated stores. Management also said ROCE and ROE moderated in H1 FY27 after the Rs 700 cr QIP completed on 4 August 2026.
Q2FY27 at a glance
Consolidated figures as filed with NSE — cross-checked against an independent source.
| Line item | Q2FY27 | Q1FY27 | QoQ |
|---|---|---|---|
| Revenue | ₹2,666 cr | ₹2,413 cr | +10.50% |
| Other income | ₹17 cr | ₹10 cr | +71.31% |
| Expenses | ₹2,459 cr | ₹2,231 cr | +10.24% |
| Operating profit | ₹207 cr | ₹182 cr | +13.73% |
| Operating margin (%) | 7.78% | 7.56% | — |
| Interest | ₹42 cr | ₹34 cr | +22.87% |
| Depreciation | ₹20 cr | ₹18 cr | +13.85% |
| Profit before tax | ₹163 cr | ₹141 cr | +15.61% |
| Tax | ₹41 cr | ₹35 cr | +17.50% |
| Net profit | ₹121 cr | ₹105 cr | +14.98% |
| EPS (₹) | ₹8.69 | ₹7.76 | +11.98% |
Operating margin of 7.78% compares with a Consumer Discretionary sector median of 12.74% across 107 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.
Expansion
- The company has seven stores in its expansion states, all of which are company-owned.
- The company is expanding its presence across Uttar Pradesh, Madhya Pradesh, Bihar and Haryana with company-owned stores.
- The company completed the acquisition of Silvostyle on 1 October 2026.
New initiatives
- The company uses a five-step market-entry playbook covering channel checks, tailored strategy, regional hubs, launch and continuous improvement.
- The company is building a healthy mix of franchise-owned, company-operated stores.
Problems & risks
- ROCE and ROE further moderated in H1 FY27 following the ₹700 crore QIP completed on August 4, 2026.
What to watch
- Whether consolidated operating margin moves above 7.78% in the next quarter.
- Whether interest expense growth remains elevated after the 22.87% QoQ increase.
- How the seven company-owned stores in the expansion states contribute to the consolidated business.