VMS TMT profit falls 17% as revenue and margins weaken year on year
The standalone operating margin recovered sequentially, but higher tax and interest costs pulled net profit down 60.63% from Q1FY27.
Filed 05 Nov 2026, 16:54 IST · after market close · VMS TMT Ltd (VMSTMT)
Key takeaways
- Standalone net profit fell 17.37% year on year to Rs 1.76 cr as revenue declined 8.42%.
- Operating margin narrowed 0.58 percentage points year on year to 6.02% because expenses fell less than revenue.
- Sequentially, operating margin improved 1.15 percentage points, but the 34.35% tax rate and 17.42% rise in interest expense weakened profit conversion.
Price around the results
Revenue contraction outweighed lower expenses
VMS TMT’s standalone revenue fell 8.42% year on year to Rs 167.65 cr, while expenses declined 7.85%; costs therefore fell more slowly than revenue. That mismatch reduced operating profit by 16.46% and pushed net profit down 17.37% to Rs 1.76 cr. Other income contributed only 5.6% of pre-tax profit, so it was not a material support to earnings quality.
Sequential margin recovery came with higher financial costs
Compared with Q1FY27, revenue fell 32.33% and expenses fell 33.15%, allowing operating margin to improve by 1.15 percentage points to 6.02%. The benefit was offset by a 17.42% rise in interest expense and a 12.99-percentage-point increase in the tax rate to 34.35%. As a result, pre-tax profit declined 52.82% and net profit fell 60.63% sequentially.
Margin is below the sector median after a volatile run
Operating margin has recovered from 4.85% in Q4FY26 and 4.87% in Q1FY27, but remains below the 8.49% recorded in Q3FY26. Among 178 Industrials companies that have reported, VMS TMT’s 6.02% margin is 5.48 percentage points below the sector median of 11.5% and ranks 24th from the bottom. The year-on-year margin decline shows that the sequential recovery has not yet restored last year’s level.
No immediate market reaction after the filing
The results were filed after market close, so there was no market reaction to report yet. In the four comparable post-results sessions, the stock rose once and fell three times, with a median absolute move of 2.77%; the current filing therefore has no observed reaction against which to compare.
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 | YoY |
|---|---|---|---|---|
| Revenue | ₹168 cr | ₹248 cr | -32.33% | -8.42% |
| Other income | ₹0 cr | ₹0 cr | +25.00% | +7.14% |
| Expenses | ₹158 cr | ₹236 cr | -33.15% | -7.85% |
| Operating profit | ₹10 cr | ₹12 cr | -16.32% | -16.46% |
| Operating margin (%) | 6.02% | 4.87% | — | — |
| Interest | ₹5 cr | ₹4 cr | +17.42% | -32.61% |
| Depreciation | ₹3 cr | ₹3 cr | +14.51% | +16.80% |
| Profit before tax | ₹3 cr | ₹6 cr | -52.82% | -5.30% |
| Tax | ₹1 cr | ₹1 cr | -23.97% | +31.43% |
| Net profit | ₹2 cr | ₹4 cr | -60.63% | -17.37% |
| EPS (₹) | ₹0.35 | ₹0.90 | -61.11% | -40.68% |
Operating margin of 6.02% compares with a Industrials sector median of 11.50% across 178 peers that have reported Q2FY27.
How the stock reacted
| Window | Stock | vs NIFTY |
|---|---|---|
| Results day | -0.46% | -2.47% |
Volume on the results session was 2.73× its 20-day average.
What to watch
- Whether revenue recovers from Rs 167.65 cr after the 32.33% sequential decline.
- Whether operating margin holds above 6.02% after the sequential recovery.
- Whether the tax rate moves down from 34.35% and interest expense from Rs 4.65 cr.