Vinati Organics margin slides to 19.40% as costs outpace sales
Standalone profit fell 32.69% year on year, with other income contributing 10.92% of pre-tax profit.
Filed 30 Oct 2026, 14:01 IST · Vinati Organics Ltd (VINATIORGA)
Key takeaways
- Standalone operating margin fell 13.30 percentage points year on year to 19.40% as expenses grew 46.45% against 22.28% revenue growth.
- Sequentially, revenue declined 4.26% while expenses rose 4.26%, driving a 6.58-percentage-point margin contraction.
- The stock fell 8.18% by the next trading session, well below its 1.38% median post-results move over the past eight reactions.
Price around the results
Profit fell despite 22.28% revenue growth
Vinati Organics' standalone revenue rose 22.28% year on year to Rs 668 cr, but operating profit declined 27.46% as expenses increased 46.45% to Rs 538.44 cr. Profit before tax fell 32.91% and net profit fell 32.69% to Rs 86.84 cr. Other income contributed 10.92% of pre-tax profit, so reported earnings included a meaningful non-operating component.
Sequential margin loss widened sharply
Revenue declined 4.26% from Q1FY27 while expenses rose 4.26%, causing operating margin to narrow by 6.58 percentage points. The tax rate changed by only 0.11 percentage points and interest remained negligible, so the profit decline was primarily operational. Operating margin has now fallen for four straight quarters from 32.70% in Q2FY26 to 19.40%.
Margin remains above the reported commodity-peer median
Vinati's 19.40% operating margin was 6.18 percentage points above the 13.22% median for the 112 commodity-sector peers that had reported the same quarter. That relative position does not offset the company's own fourth consecutive quarterly decline in margin.
Market reaction was unusually negative
The stock fell 4.47% on the results date and was down 8.18% by the next trading session, with volume at 8.15 times the normal level. This was weaker than the stock's recent pattern: five of its past eight results reactions were negative, but the median absolute move was only 1.38%.
Q2FY27 at a glance
Standalone figures as filed with NSE — cross-checked against an independent source.
| Line item | Q2FY27 | Q1FY27 | QoQ | YoY |
|---|---|---|---|---|
| Revenue | ₹668 cr | ₹698 cr | -4.26% | +22.28% |
| Other income | ₹13 cr | ₹9 cr | +43.16% | -20.46% |
| Expenses | ₹538 cr | ₹516 cr | +4.26% | +46.45% |
| Operating profit | ₹130 cr | ₹181 cr | -28.54% | -27.46% |
| Operating margin (%) | 19.40% | 25.98% | — | — |
| Interest | ₹0 cr | ₹0 cr | — | +0.00% |
| Depreciation | ₹26 cr | ₹25 cr | +3.56% | +21.50% |
| Profit before tax | ₹116 cr | ₹165 cr | -29.62% | -32.91% |
| Tax | ₹29 cr | ₹41 cr | -29.32% | -33.56% |
| Net profit | ₹87 cr | ₹124 cr | -29.72% | -32.69% |
| EPS (₹) | ₹8.38 | ₹11.92 | -29.70% | -32.69% |
Operating margin of 19.40% compares with a Commodities sector median of 13.22% across 112 peers that have reported Q2FY27.
How the stock reacted
| Window | Stock | vs NIFTY |
|---|---|---|
| Results day | -4.47% | -4.97% |
| Next session | -8.18% | — |
Volume on the results session was 8.15× its 20-day average.
What to watch
- Whether operating margin holds above 19.40% after four consecutive quarterly declines.
- Whether expenses reverse the latest 4.26% sequential increase.
- Whether other income remains near its 10.92% share of pre-tax profit.