Revenue jumps 29.33% qoq, but margin slips as costs outpace growth
Standalone net profit rose 17.62% despite a 153.02% rise in interest and a 3.04 percentage-point increase in the tax rate.
Filed 03 Nov 2026, 16:31 IST · after market close · Sedemac Mechatronics Ltd (SEDEMAC)
Key takeaways
- Standalone revenue rose 29.33% sequentially, but expenses grew faster at 29.72%, trimming operating margin by 0.24 percentage points.
- Net profit increased 17.62% to Rs 39.18 cr despite a 153.02% rise in interest and a 3.04 percentage-point increase in the tax rate.
- Operating margin at 18.86% was 6.51 percentage points above the 12.35% median for 163 Consumer Discretionary peers that reported.
Price around the results
Revenue growth came with a smaller profit conversion
Sedemac Mechatronics reported standalone revenue of Rs 400.64 cr in Q2FY27, up 29.33% from Q1FY27, while operating profit rose 27.72% to Rs 75.57 cr. The slower operating-profit growth shows that incremental revenue converted into profit at a lower rate. Management said two launches were completed during the quarter and that the ISG ECU ramp-up was completed on variants of two top-10 motorcycle models.
Higher interest and tax limited net-profit growth
Expenses grew 29.72%, faster than revenue, reducing operating margin by 0.24 percentage points to 18.86%. Interest rose 153.02% sequentially, while the tax rate increased 3.04 percentage points to 22.46%, helping explain why net profit grew only 17.62%. Other income contributed just 1.21% of pre-tax profit, so it was not a material support to earnings quality.
Margin remains above the reported peer median
Sedemac's 18.86% operating margin was 6.51 percentage points above the 12.35% median among 163 reported Consumer Discretionary peers. Sequentially, however, margin moved lower from 19.10% in Q1FY27, making cost growth the key near-term operating read.
Management flags new production and order activity
The company said pilot production had started at its new facility and that E2W MCUs had reached full ramp-up for FY26 standard-production programmes. Management also said Sedemac had won ISG ECU and magneto kit business from a European two- and three-wheeler OEM, with production expected to start in H1FY28. The presentation identified wet magneto as a key SLC technology and said ISG ECUs were being introduced on variants of two top-10 motorcycle models.
Results were filed after market close
Sedemac filed the standalone Q2FY27 results after market close on 03 November 2026. No market reaction is covered for this filing.
Q2FY27 at a glance
Standalone figures as filed with NSE — filed ahead of third-party databases, not yet independently cross-checked.
| Line item | Q2FY27 | Q1FY27 | QoQ |
|---|---|---|---|
| Revenue | ₹401 cr | ₹310 cr | +29.33% |
| Other income | ₹1 cr | ₹1 cr | -29.07% |
| Expenses | ₹325 cr | ₹251 cr | +29.72% |
| Operating profit | ₹76 cr | ₹59 cr | +27.72% |
| Operating margin (%) | 18.86% | 19.10% | — |
| Interest | ₹6 cr | ₹2 cr | +153.02% |
| Depreciation | ₹20 cr | ₹16 cr | +20.83% |
| Profit before tax | ₹51 cr | ₹41 cr | +22.23% |
| Tax | ₹11 cr | ₹8 cr | +41.34% |
| Net profit | ₹39 cr | ₹33 cr | +17.62% |
| EPS (₹) | ₹8.87 | ₹7.54 | +17.64% |
Operating margin of 18.86% compares with a Consumer Discretionary sector median of 12.35% across 163 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.
This quarter
- Two launches were completed in the quarter.
- The ISG ECU ramp-up was completed on variants of two top-10 motorcycle models.
Guidance & outlook
- Two launches are expected in Q1FY27, with a third launch expected in Q4FY27.
- A third launch is expected in Q4FY27.
- The ISG ECU and magneto kit win from a European 2/3-wheeler OEM is expected to start production in H1FY28.
Expansion
- Pilot production has started at the new facility.
New orders
- SEDEMAC won an ISG ECU and magneto kit business from a European 2/3-wheeler OEM.
New initiatives
- SEDEMAC is introducing ISG ECUs on variants of two top-10 motorcycle models.
- Wet magneto is identified as a key SLC technology.
- E2W MCUs reached full ramp-up for FY26 standard-production programmes.
What to watch
- Whether operating margin holds above 18.86% after the 0.24 percentage-point sequential decline.
- Whether interest remains near or moves below the Q2FY27 level of Rs 5.87 cr after rising 153.02% sequentially.
- Whether revenue growth follows the 29.33% sequential increase as pilot production and the completed launches progress.