Revenue growth outpaced costs, lifting Zodiac Energy's margin
Net profit rose 31.00% QoQ, but the gain was aided by a lower tax rate and other income equal to 7.16% of pre-tax profit.
Filed 30 Oct 2026, 13:04 IST · Zodiac Energy Ltd (ZODIAC)
Key takeaways
- Consolidated revenue rose 17.21% QoQ while operating margin widened 0.43 percentage points to 11.58%.
- Net profit increased 31.00% QoQ, helped by a 7.69 percentage-point fall in the tax rate to 20.95%.
- Zodiac Energy's 11.58% operating margin was 0.85 percentage points below the Industrials median across 75 reported peers.
Price around the results
Q2 growth came with modest operating leverage
In the consolidated Q2FY27 results, revenue grew 17.21% QoQ while expenses rose 16.65%, allowing operating profit to increase 21.70%. The margin improvement was therefore driven by costs growing slightly slower than revenue, rather than by a sharp change in operating economics.
Tax relief amplified the profit increase
Profit before tax rose 18.25% QoQ, while net profit grew faster at 31.00% as the tax rate fell 7.69 percentage points to 20.95%. Interest was broadly stable, increasing 0.58%, although depreciation rose 41.13% during the quarter. Other income contributed 7.16% of pre-tax profit, so reported earnings also included a meaningful non-operating component.
Margin remains below the Industrials peer median
Zodiac Energy's 11.58% operating margin was below the 12.43% median for the 75 Industrials companies that had reported the same quarter. The gap was 0.85 percentage points, despite the sequential margin improvement. The available quarter-to-quarter trend shows margin moving up from 11.15% in Q1FY27.
Q2FY27 at a glance
Consolidated figures as filed with NSE — cross-checked against an independent source.
| Line item | Q2FY27 | Q1FY27 | QoQ |
|---|---|---|---|
| Revenue | ₹166 cr | ₹142 cr | +17.21% |
| Other income | ₹1 cr | ₹1 cr | -44.30% |
| Expenses | ₹147 cr | ₹126 cr | +16.65% |
| Operating profit | ₹19 cr | ₹16 cr | +21.70% |
| Operating margin (%) | 11.58% | 11.15% | — |
| Interest | ₹5 cr | ₹5 cr | +0.58% |
| Depreciation | ₹3 cr | ₹2 cr | +41.13% |
| Profit before tax | ₹12 cr | ₹10 cr | +18.25% |
| Tax | ₹2 cr | ₹3 cr | -13.52% |
| Net profit | ₹9 cr | ₹7 cr | +31.00% |
| EPS (₹) | ₹5.92 | ₹4.57 | +29.54% |
Operating margin of 11.58% compares with a Industrials sector median of 12.43% across 75 peers that have reported Q2FY27.
What to watch
- Whether operating margin holds above 11.58% next quarter.
- Whether expenses continue to grow more slowly than revenue's 17.21% QoQ pace.
- Whether the tax rate stays near 20.95% and other income remains below 7.16% of pre-tax profit.