Costs outpaced revenue as West Coast Paper margin fell 4.14 percentage points
Q2 net profit fell -21.08% QoQ as interest rose +39.14% and the tax rate increased 4.79 percentage points.
Filed 06 Nov 2026, 14:41 IST · West Coast Paper Mills Ltd (WSTCSTPAPR)
Key takeaways
- Expenses grew +27.68% QoQ against revenue growth of +21.45%, cutting operating margin by 4.14 percentage points.
- Net profit fell -21.08% QoQ as interest expense rose +39.14% and the tax rate increased 4.79 percentage points.
- The 15.20% operating margin remained 2.35 percentage points above the 12.85% median for 136 reported sector peers.
Price around the results
Revenue growth failed to translate into operating profit
On a consolidated basis, revenue grew +21.45% QoQ to Rs 1,276.77 cr, but expenses rose faster at +27.68%. That cost mismatch reduced operating profit by -4.55% and pulled operating margin down from 19.34% to 15.20%, a decline of 4.14 percentage points.
Higher interest and tax reduced profit conversion
Profit before tax fell -15.94% QoQ, despite the increase in revenue, as interest expense rose +39.14% and depreciation increased +2.47%. The tax rate moved up 4.79 percentage points to 26.53%, adding to the pressure on net profit, which declined -21.08%. Other income contributed 19.36% of pre-tax profit, so reported earnings also included a meaningful non-operating contribution.
Margin stayed above the sector median, but the stock sold off
West Coast Paper's 15.20% operating margin was 2.35 percentage points above the 12.85% median among 136 Commodities peers that had reported the quarter. The stock fell -12.22% on the results date, with trading volume at 1.76 times the reference level; the reported reaction was notably negative despite the company's margin remaining above the peer median.
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 | ₹1,277 cr | ₹1,051 cr | +21.45% |
| Other income | ₹29 cr | ₹45 cr | -33.98% |
| Expenses | ₹1,083 cr | ₹848 cr | +27.68% |
| Operating profit | ₹194 cr | ₹203 cr | -4.55% |
| Operating margin (%) | 15.20% | 19.34% | — |
| Interest | ₹11 cr | ₹8 cr | +39.14% |
| Depreciation | ₹60 cr | ₹59 cr | +2.47% |
| Profit before tax | ₹152 cr | ₹181 cr | -15.94% |
| Tax | ₹40 cr | ₹39 cr | +2.56% |
| Net profit | ₹112 cr | ₹142 cr | -21.08% |
| EPS (₹) | ₹16.77 | ₹20.21 | -17.02% |
Operating margin of 15.20% compares with a Commodities sector median of 12.85% across 136 peers that have reported Q2FY27.
How the stock reacted
| Window | Stock | vs NIFTY |
|---|---|---|
| Results day | -12.22% | -14.23% |
Volume on the results session was 1.76× its 20-day average.
What to watch
- Whether operating margin recovers from 15.20% after the 4.14-percentage-point QoQ decline.
- Whether expense growth moderates from +27.68% relative to revenue growth of +21.45%.
- Whether interest expense moves down from its +39.14% QoQ increase and the tax rate from 26.53%.