RVNL expands margins as revenue falls YoY; other income stays material
Operating margin rose to 5.62%, but it remained 5.89 percentage points below the Industrials peer median.
Filed 12 Nov 2026, 19:49 IST · after market close · Rail Vikas Nigam Ltd (RVNL)
Key takeaways
- Operating margin expanded 1.39 percentage points YoY to 5.62% as expenses fell faster than revenue.
- Sequential revenue growth of +8.79% outpaced expense growth of +7.26%, lifting operating profit by +42.99%.
- Other income contributed 50.81% of pre-tax profit, while the tax rate fell 10.63 percentage points YoY.
Price around the results
Sequential recovery did not fully offset the YoY revenue decline
On a consolidated basis, revenue increased +8.79% QoQ but declined -8.24% YoY. The sequential recovery was supported by expenses rising more slowly than revenue, while the YoY decline in expenses of -9.56% exceeded the revenue contraction and helped operating profit increase +21.70%.
Margin gains came with a significant non-operating contribution
Operating margin expanded by 1.35 percentage points QoQ and 1.39 percentage points YoY because costs grew more slowly sequentially and fell faster than revenue YoY. Lower interest expense, down -4.53% QoQ and -6.56% YoY, also supported pre-tax profit. Other income accounted for 50.81% of pre-tax profit, while the lower tax rate helped net profit rise +59.05% QoQ and +10.06% YoY.
Operating margin has improved for two straight quarters
Operating margin rose from 4.01% in Q4FY26 to 4.27% in Q1FY27 and 5.62% in Q2FY27, marking a second consecutive quarterly expansion. Even after the improvement, RVNL's margin was 5.89 percentage points below the 11.51% median of 230 Industrials peers that had reported.
No immediate market reaction after the post-close filing
The consolidated results were filed after market close, so the immediate market response is not covered here. In the last eight result reactions, the stock declined each time, with a median absolute move of 3.81%.
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 | YoY |
|---|---|---|---|---|
| Revenue | ₹4,701 cr | ₹4,321 cr | +8.79% | -8.24% |
| Other income | ₹165 cr | ₹147 cr | +12.31% | -29.46% |
| Expenses | ₹4,437 cr | ₹4,137 cr | +7.26% | -9.56% |
| Operating profit | ₹264 cr | ₹185 cr | +42.99% | +21.70% |
| Operating margin (%) | 5.62% | 4.27% | — | — |
| Interest | ₹93 cr | ₹98 cr | -4.53% | -6.56% |
| Depreciation | ₹10 cr | ₹10 cr | +0.10% | +16.93% |
| Profit before tax | ₹325 cr | ₹224 cr | +45.59% | -4.95% |
| Tax | ₹72 cr | ₹64 cr | +12.06% | -35.87% |
| Net profit | ₹254 cr | ₹160 cr | +59.05% | +10.06% |
| EPS (₹) | ₹1.20 | ₹0.76 | +57.89% | +9.09% |
Operating margin of 5.62% compares with a Industrials sector median of 11.51% across 230 peers that have reported Q2FY27.
What to watch
- Whether operating margin holds above 5.62% after two consecutive quarterly increases.
- Whether revenue growth remains ahead of expense growth after the +8.79% versus +7.26% QoQ spread.
- Whether other income's contribution to pre-tax profit moves below 50.81%.