Sanstar margin falls as costs outpace revenue growth
Revenue rose 5.87% quarter on quarter, but expenses grew 10.05%; other income made up 71.05% of profit before tax.
Filed 05 Nov 2026, 19:28 IST · after market close · Sanstar Ltd (SANSTAR)
Key takeaways
- Consolidated operating margin fell 3.65 percentage points quarter on quarter to 3.81% as expenses grew faster than revenue.
- Net profit declined 36.37% quarter on quarter to Rs 5.86 cr, with other income contributing 71.05% of profit before tax.
- Sanstar's 3.81% operating margin was 6.88 percentage points below the 10.69% median for 62 FMCG peers.
Price around the results
Revenue growth did not translate into profit growth
Sanstar's consolidated revenue increased 5.87% quarter on quarter, but operating profit fell 45.97% and net profit declined 36.37% to Rs 5.86 cr. The result was weaker operating conversion despite higher sales in Q2FY27.
Faster cost growth squeezed the operating margin
Expenses grew 10.05%, ahead of the 5.87% rise in revenue, reducing operating margin by 3.65 percentage points to 3.81%. Interest expense also increased 76.47% quarter on quarter, while the tax rate was broadly unchanged, falling by 0.04 percentage points to 26.57%.
Margin trails the FMCG peer median
Sanstar's 3.81% operating margin was 6.88 percentage points below the 10.69% median among 62 FMCG companies that had reported the quarter. Sequentially, this was a further decline from 7.46% in Q1FY27, making margin compression the clearest direction across the available quarters.
Profit quality weakened as other income rose
Other income increased 104.69% quarter on quarter to Rs 5.67 cr and represented 71.05% of profit before tax. That makes the reported Rs 5.86 cr net profit less reflective of operating earnings, which fell sharply during the quarter.
Results were filed after market close
The consolidated results were filed after market close on 05 Nov 2026. A market reaction was therefore not yet available in the reported results window.
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 | ₹218 cr | ₹206 cr | +5.87% |
| Other income | ₹6 cr | ₹3 cr | +104.69% |
| Expenses | ₹210 cr | ₹191 cr | +10.05% |
| Operating profit | ₹8 cr | ₹15 cr | -45.97% |
| Operating margin (%) | 3.81% | 7.46% | — |
| Interest | ₹1 cr | ₹0 cr | +76.47% |
| Depreciation | ₹5 cr | ₹5 cr | +2.66% |
| Profit before tax | ₹8 cr | ₹13 cr | -36.41% |
| Tax | ₹2 cr | ₹3 cr | -36.53% |
| Net profit | ₹6 cr | ₹9 cr | -36.37% |
| EPS (₹) | ₹0.29 | ₹0.50 | -42.00% |
Operating margin of 3.81% compares with a Fast Moving Consumer Goods sector median of 10.69% across 62 peers that have reported Q2FY27.
What to watch
- Whether operating margin recovers from 3.81% after the 3.65-percentage-point sequential decline.
- Whether expense growth slows from 10.05% and moves closer to revenue growth of 5.87%.
- Whether other income remains a major contributor after accounting for 71.05% of profit before tax.