Sanathan Textiles lifts margin as profit jumps 157.05% sequentially
Revenue growth slightly outpaced expense growth, while the lower tax rate amplified the increase in net profit.
Filed 04 Nov 2026, 17:34 IST · after market close · Sanathan Textiles Ltd (SANATHAN)
Key takeaways
- Consolidated revenue grew 35.16% sequentially, while expenses rose 34.45%, lifting operating margin by 0.47 percentage points.
- Net profit increased 157.05% sequentially, helped by a 13.82-percentage-point fall in the tax rate to 24.02%.
- Operating margin at 8.57% remained 3.26 percentage points below the 11.83% median for 210 reported Consumer Discretionary peers.
Price around the results
Revenue momentum improved in Q2FY27
Sanathan Textiles reported consolidated revenue growth of 35.16% over Q1FY27, with operating profit growing faster at 43.12%. The resulting 0.47-percentage-point improvement in operating margin indicates that incremental revenue converted into operating profit despite the higher scale. The company filed these results after market close on 4 Nov 2026, so the immediate share-price response is not covered here.
Tax relief did more work than other income
Expenses rose 34.45%, slightly slower than revenue, supporting the margin improvement rather than constraining it. Net profit growth of 157.05% was amplified by the tax rate falling 13.82 percentage points to 24.02%; other income contributed 5.58% of pre-tax profit and was not the main driver. Interest expense still increased 8.80% sequentially, partly offsetting the operating improvement.
Margin remains below the sector midpoint
The 8.57% operating margin was 3.26 percentage points below the 11.83% median among 210 Consumer Discretionary peers that had reported the quarter. Sequentially, margin improved from 8.10% in Q1FY27, but the available trend shows only one prior quarter, so a multi-quarter direction is not established. The key comparison is therefore the modest quarter-on-quarter improvement against a lower-than-peer margin base.
Management links expansion to efficiency and value addition
Management said it plans to improve efficiency, expand capacity and remain focused on margins. The presentation said the Silvassa facility's automated doffing, transport, packaging and warehousing are intended to reduce labour dependency and improve efficiency. It also said the Punjab facility is pursuing greater value addition through new products and uses agricultural-waste solid fuel for heating.
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 |
|---|---|---|---|
| Revenue | ₹1,804 cr | ₹1,335 cr | +35.16% |
| Other income | ₹5 cr | ₹4 cr | +25.35% |
| Expenses | ₹1,649 cr | ₹1,227 cr | +34.45% |
| Operating profit | ₹155 cr | ₹108 cr | +43.12% |
| Operating margin (%) | 8.57% | 8.10% | — |
| Interest | ₹42 cr | ₹39 cr | +8.80% |
| Depreciation | ₹37 cr | ₹35 cr | +5.30% |
| Profit before tax | ₹81 cr | ₹38 cr | +110.31% |
| Tax | ₹19 cr | ₹15 cr | +33.52% |
| Net profit | ₹61 cr | ₹24 cr | +157.05% |
| EPS (₹) | ₹7.26 | ₹2.82 | +157.45% |
Operating margin of 8.57% compares with a Consumer Discretionary sector median of 11.83% across 210 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.
Guidance & outlook
- The company plans to improve efficiency, expand capacity and remain focused on margins.
New initiatives
- The Silvassa facility uses automated doffing, transport, packaging and warehousing to reduce labour dependency and improve efficiency.
- The Punjab facility is pursuing enhanced value addition through new product development.
- The Punjab facility uses agricultural-waste solid fuel for heating.
What to watch
- Whether operating margin holds above the Q2FY27 level of 8.57%.
- Whether expenses continue to grow no faster than revenue, after the Q2FY27 comparison of 34.45% versus 35.16%.
- Whether the tax rate remains near 24.02% rather than returning toward Q1FY27's 37.84%.