MRF Q2 FY27: consolidated PAT drops 26% YoY to ₹387 Cr as cost pressure squeezes margins

MRF's consolidated revenue rose 17.4% YoY to ₹8,660.19 Cr (from ₹7,378.72 Cr) in Q2 FY27, but consolidated PAT fell 26.4% YoY to ₹386.99 Cr (from ₹525.64 Cr) — topline growth did not translate to the bottom line. Sequentially the slide continued: PAT is down 21.9% QoQ from ₹495.35 Cr in Q1 FY27 even as revenue edged up only 2.9% QoQ, confirming this is an accelerating margin squeeze rather than a one-quarter blip. Standalone tells the same story — PAT of ₹369.15 Cr, down 27.8% YoY on revenue of ₹8,523.96 Cr (+17.6% YoY) — so the decline sits in the core India business, not in the subsidiaries layered on top of it in consolidation. The squeeze sits almost entirely on the cost-of-materials line: cost of materials consumed climbed to 75.7% of consolidated revenue (₹6,552.57 Cr) from 62.0% a year ago (₹4,577.49 Cr), consistent with the rubber and crude cost pressure management flagged after Q1 FY27. Total expenses grew 21.9% YoY against 17.4% revenue growth, dragging consolidated PBT margin to 6.0% from 9.5% a year ago, and NPM to 4.4% from 7.0% YoY (and from 5.75% just last quarter). Other expenses (₹1,337.84 Cr vs ₹1,103.64 Cr) and depreciation (₹469.79 Cr vs ₹445.11 Cr, tracking ongoing capex — capital work-in-progress is up to ₹1,207.85 Cr) added further drag. There were no exceptional items in either the current or year-ago quarter, so the decline is fully operational rather than one-off driven. We have no formal numeric guidance from MRF on record, and a street consensus figure specific to this quarter could not be reliably verified — one web report's claimed PAT of ₹455 Cr beating a ₹425 Cr estimate did not reconcile with the filing's own arithmetic-checked ₹386.99 Cr and is disregarded here (vsStreet: unknown). What does carry through is management's own prior commentary (via web, not in our records) that "the impact of higher costs on margins is expected to continue" — this quarter confirms that call, with NPM compressing further rather than stabilising. Two board actions this quarter sit apart from the operating print: an interim dividend of ₹3 per share (30% of face value, record date 17 November 2026), and a tax demand cut to ₹36.19 Cr from ₹91.53 Cr (announced 7 October 2026) — a balance-sheet positive unconnected to the margin story. The result leaves three numbers to track into Q3 FY27: the cost-of-materials ratio (75.7% of revenue this quarter, up from 62.0% YoY), consolidated NPM (4.4%, down from 5.75% last quarter and 7.0% a year ago), and whether the standalone-consolidated gap in PAT decline (27.8% vs 26.4%) persists.