Margin rebounds, but remains below the year-ago level
Revenue grew 53.90% YoY, yet costs rose faster; management said Wires & Cables growth reached 57% and FMEG achieved operational breakeven.
Filed 27 Jul 2026, 15:06 IST · R R Kabel Ltd (RRKABEL)
Key takeaways
- Revenue rose 53.90% YoY, but faster expense growth narrowed operating margin by 0.52 percentage points.
- Operating margin rebounded 7.68 percentage points QoQ as revenue grew 6.88% while expenses fell 1.32%.
- Management said Wires & Cables revenue grew 57% YoY and FMEG reached operational breakeven.
Price around the results
Standalone profit recovered sharply from Q4FY26
R R Kabel's standalone net profit rose 128.82% YoY and 22.30% QoQ as operating profit recovered from a loss in Q4FY26. Other income grew 165.32% YoY and accounted for 12.01% of pre-tax profit, making it a meaningful contributor to reported earnings. The tax rate increased 0.41 percentage points YoY, so a lower tax charge was not the reason for the profit growth.
Cost growth kept the annual margin under pressure
Expenses grew 54.78% YoY against revenue growth of 53.90%, which narrowed operating margin by 0.52 percentage points. Interest expense rose 73.83% and depreciation increased 46.23% YoY, adding pressure below operating profit. Sequentially, the picture improved as revenue rose 6.88% while expenses declined 1.32%, lifting operating margin by 7.68 percentage points.
Margin decline finally broke after five quarters
Operating margin had declined for five consecutive quarters from Q4FY25 through Q4FY26 before recovering to 7.55% in Q1FY27. The margin was 0.21 percentage points above the 7.34% median for the 12 Industrials peers that had reported, though it ranked 8th from the bottom among them.
Management linked growth to mix and execution
Management said Wires & Cables growth was supported by volume gains, execution and industry conditions, while segment profit increased 105% YoY. The company said improved product mix, commodity management and operating efficiencies helped that segment's profitability. Management also said FMEG benefited from demand for premium and new products, continued distribution expansion and operational leverage, and had reached operational breakeven.
Past result-day moves have been mixed
After its last eight results, the stock rose three times and fell five times, with a median absolute move of 5.90%. That history points to a mixed reaction pattern rather than a consistent direction after earnings.
Q1FY27 at a glance
Standalone figures as filed with NSE — filed ahead of third-party databases, not yet independently cross-checked.
| Line item | Q1FY27 | Q4FY26 | QoQ | YoY |
|---|---|---|---|---|
| Revenue | ₹3,168 cr | ₹2,964 cr | +6.88% | +53.90% |
| Other income | ₹33 cr | ₹13 cr | +154.45% | +165.32% |
| Expenses | ₹2,929 cr | ₹2,968 cr | -1.32% | +54.78% |
| Operating profit | ₹239 cr | ₹-4 cr | — | +43.93% |
| Operating margin (%) | 7.55% | -0.13% | — | — |
| Interest | ₹26 cr | ₹25 cr | +5.28% | +73.83% |
| Depreciation | ₹30 cr | ₹26 cr | +13.49% | +46.23% |
| Profit before tax | ₹274 cr | ₹223 cr | +22.58% | +130.11% |
| Tax | ₹71 cr | ₹57 cr | +23.41% | +133.82% |
| Net profit | ₹203 cr | ₹166 cr | +22.30% | +128.82% |
| EPS (₹) | ₹17.96 | ₹14.69 | +22.26% | +128.79% |
Operating margin of 7.55% compares with a Industrials sector median of 7.34% across 12 peers that have reported Q1FY27.
What management said
From the company’s own investor presentation. Each point is checked against the source document before it appears here.
This quarter
- Wires & Cables revenue grew 57% YoY, supported by volume growth, strong execution and favorable industry dynamics.
- Wires & Cables segment profit increased 105% YoY through margin expansion and effective cost management.
- FMEG revenue grew with demand for premium and new products across key categories.
Expansion
- FMEG is continuing its distribution expansion across key categories.
New initiatives
- Wires & Cables improved its product mix, commodity management and operating efficiencies to expand margins.
- FMEG achieved operational breakeven as part of its business transformation.
- FMEG improved profitability through premium products and operating leverage.
What to watch
- Whether operating margin holds above 7.55% after the 7.68-percentage-point QoQ rebound.
- Whether expenses continue to grow slower than revenue after rising 54.78% YoY versus revenue growth of 53.90%.
- Whether other income's 12.01% share of pre-tax profit declines.