STERTOOLS revenue rises 16.95%, but net profit falls 49.32%
Expenses grew faster than revenue, narrowing operating margin by 2.69 percentage points; a higher tax rate further pressured earnings.
Filed 27 Oct 2026, 13:03 IST · STERTOOLS (STERTOOLS)
Key takeaways
- Stertools' consolidated revenue grew 16.95% sequentially, but expenses grew 20.47%, cutting operating profit 12.79%.
- Net profit fell 49.32% sequentially as the tax rate rose 11.43 percentage points and interest expense increased 35.19%.
- Other income contributed 26.35% of pre-tax profit, making the Rs 2.97 cr net profit more dependent on non-operating income.
Revenue growth did not translate into operating profit
Stertools reported consolidated revenue of Rs 250.35 cr in Q2FY27, up 16.95% from Q1FY27. Expenses rose faster at 20.47%, reducing operating profit by 12.79% and narrowing the operating margin by 2.69 percentage points to 7.90%. This points to weaker operating conversion despite higher sales.
Higher interest and tax rates compounded the margin squeeze
Interest expense increased 35.19% sequentially, while depreciation rose 2.00%, adding pressure below operating profit. Profit before tax declined 32.43%, and the tax rate rose 11.43 percentage points to 65.86%, leaving net profit down 49.32% at Rs 2.97 cr. Other income accounted for 26.35% of pre-tax profit, so reported earnings also had a meaningful non-operating component.
Sequential momentum weakened after the first quarter
Q2FY27 revenue increased from Rs 214.07 cr in Q1FY27, but operating profit fell from Rs 22.67 cr and EPS dropped 49.07% to Rs 0.82. The available trend shows the operating margin moving down from 10.59% in Q1FY27 to 7.90% in Q2FY27, making margin recovery and the cost trajectory the key next-quarter markers.
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 | ₹250 cr | ₹214 cr | +16.95% |
| Other income | ₹2 cr | ₹3 cr | -9.49% |
| Expenses | ₹231 cr | ₹191 cr | +20.47% |
| Operating profit | ₹20 cr | ₹23 cr | -12.79% |
| Operating margin (%) | 7.90% | 10.59% | — |
| Interest | ₹3 cr | ₹2 cr | +35.19% |
| Depreciation | ₹10 cr | ₹10 cr | +2.00% |
| Profit before tax | ₹9 cr | ₹13 cr | -32.43% |
| Tax | ₹6 cr | ₹7 cr | -18.29% |
| Net profit | ₹3 cr | ₹6 cr | -49.32% |
| EPS (₹) | ₹0.82 | ₹1.61 | -49.07% |
What to watch
- Whether operating margin recovers from 7.90% toward Q1FY27's 10.59%.
- Whether expense growth remains above the 16.95% sequential revenue growth rate.
- Whether interest expense moderates after its 35.19% sequential increase.