Suzlon margin falls as expenses outpace 25.96% revenue growth
Q2FY27 consolidated revenue rose 25.96% YoY, but a prior-year tax benefit makes the 69.19% profit decline a poor measure of operating momentum.
Filed 29 Oct 2026, 15:51 IST · after market close · Suzlon Energy Ltd (SUZLON)
Key takeaways
- Suzlon's consolidated operating margin narrowed 3.86 percentage points YoY to 14.76% as expenses grew 31.94%, faster than revenue at 25.96%.
- Net profit fell 69.19% YoY, mainly because Q2FY26 included a tax benefit of Rs 716.94 cr versus a 23.94% tax rate this quarter.
- Revenue grew 27.33% QoQ and operating profit rose 20.93%, but margin still slipped 0.79 percentage points.
Price around the results
Revenue growth did not translate into higher operating profit
Suzlon's consolidated revenue rose 25.96% YoY to Rs 4,875.70 cr, but operating profit was broadly flat, down 0.14% to Rs 719.82 cr. Sequentially, revenue increased 27.33% and operating profit rose 20.93%, showing better momentum than the year-on-year comparison. Profit before tax still declined 7.87% YoY as interest rose 11.78% and depreciation increased 48.04%.
Faster cost growth squeezed margins, while tax distorted profit
Expenses grew 31.94% YoY against 25.96% revenue growth, narrowing operating margin by 3.86 percentage points to 14.76%. On a sequential basis, expenses also grew faster than revenue, so margin declined 0.79 percentage points despite a 27.33% rise in sales. The 23.94% tax rate this quarter compares with a negative 127.46% rate last year, when the Rs 716.94 cr tax benefit materially inflated net profit; other income was 6.24% of pre-tax profit this quarter.
Margin has declined for two straight quarters
Operating margin fell from 17.55% in Q4FY26 to 15.55% in Q1FY27 and 14.76% in Q2FY27. It remains 2.68 percentage points above the 12.08% median for the 61 Industrials peers that have reported the same quarter. The direction is therefore weaker even though Suzlon is still above the reported sector median.
The results were filed after market close
The results were filed after market close, so there is no reported market reaction yet. After its last eight results, the stock rose three times and fell five times, with a median absolute move of 4.36%, indicating that post-results moves have more often been negative than positive and have typically been material.
Q2FY27 at a glance
Consolidated figures as filed with NSE — cross-checked against an independent source.
| Line item | Q2FY27 | Q1FY27 | QoQ | YoY |
|---|---|---|---|---|
| Revenue | ₹4,876 cr | ₹3,829 cr | +27.33% | +25.96% |
| Other income | ₹32 cr | ₹33 cr | -3.29% | +21.81% |
| Expenses | ₹4,156 cr | ₹3,234 cr | +28.51% | +31.94% |
| Operating profit | ₹720 cr | ₹595 cr | +20.93% | -0.14% |
| Operating margin (%) | 14.76% | 15.55% | — | — |
| Interest | ₹123 cr | ₹134 cr | -8.26% | +11.78% |
| Depreciation | ₹111 cr | ₹106 cr | +5.47% | +48.04% |
| Profit before tax | ₹518 cr | ₹389 cr | +33.06% | -7.87% |
| Tax | ₹124 cr | ₹84 cr | +47.25% | — |
| Net profit | ₹394 cr | ₹305 cr | +29.14% | -69.19% |
| EPS (₹) | ₹0.29 | ₹0.22 | +31.82% | -68.82% |
Operating margin of 14.76% compares with a Industrials sector median of 12.08% across 61 peers that have reported Q2FY27.
What to watch
- Whether operating margin holds above 14.76% after two straight quarterly declines.
- Whether expense growth falls below the 31.94% YoY pace that exceeded revenue growth of 25.96%.
- Whether the tax rate remains near 23.94% rather than being distorted by a tax benefit.