Borosil Q2 FY27: Consol PAT Up YoY on Base Effect; Margins Compress, Growth Stalls

Borosil Renewables reported consolidated revenue of ₹396.7 Cr for Q2 FY27 (quarter ended September 30, 2026), up 4.7% YoY but down 2.2% QoQ from ₹405.7 Cr in Q1 FY27. Consolidated PAT came in at ₹68.8 Cr, up 11.7% YoY from ₹61.6 Cr (EPS ₹4.78 vs ₹1.98), but down 20.6% sequentially from ₹86.6 Cr. The YoY PAT jump is largely a base effect: Q2 FY26 carried a ₹7.75 Cr consolidated exceptional charge (₹33.9 Cr at the standalone level) tied to impairment of German subsidiaries Geosphere Glassworks and GMB Glasmanufaktur Brandenburg, which is absent this quarter. Stripping that one-off from both periods, adjusted consolidated PAT growth is roughly flat YoY (~-0.8%), not the +11.7% the headline shows.

The margin compression behind that flat underlying trend is cost-driven, not revenue-driven: consolidated total expenses rose 11.0% YoY to ₹317.7 Cr against just 4.7% revenue growth, led by power and fuel costs (+17.7% YoY to ₹96.6 Cr, now 24.3% of revenue vs 21.7% a year ago) and employee costs (+22.7% YoY to ₹27.0 Cr). Consolidated NPM was 16.9% — roughly flat to the 16.2% a year ago but down sharply from 20.6% in Q1 FY27 — while EBITDA margin (revenue less total expenses plus depreciation and finance costs, over revenue, applied consistently) fell to approximately 26.6% this quarter from ~31.3% in Q1 FY27. NPM held up better than the operating trend only because other income jumped to ₹10.9 Cr from ₹1.8 Cr a year ago, largely fair-value gains on financial instruments per the cash flow statement, and the effective tax rate eased to 23.2% from 28.9% a year ago — both non-operating tailwinds to reported PAT.

The stock went into the print at ₹390, down 13.8% over the past month of trading.

Management's Q1 FY27 commentary was notably bullish — standalone sales up 53% YoY then, EBITDA margin 'consistently above 33%', and guidance for a 60% sales jump once the 600 TPD expansion commissions. This quarter standalone revenue growth decelerated sharply to just 4.7% YoY (₹396.2 Cr), and the cost-driven compression above suggests the business did not sustain the above-33% margin level cited for Q1 — a clear step-down from that momentum, i.e. guidance trajectory missed. On the expansion itself, the Board revised the commissioning timeline for the SG4/SG5 furnaces (300 TPD each) at Bharuch to end-March 2027, with an incremental ₹150 Cr cost outlay taking the total 600 TPD project cost to ₹1,100 Cr — a cost overrun even as the broad Q4 FY27 timeline holds; it is being funded partly by ₹278 Cr of equity/warrant proceeds received this half, including 53.38 lakh shares allotted on warrant conversion in August 2026. No analyst consensus estimates specific to this quarter were found, so the print cannot be benchmarked against Street expectations, and no separate management press release was available to cross-check against the numbers. Standalone PAT of ₹70.1 Cr (+53% YoY reported) diverges sharply from the consolidated read once adjusted for one-offs — standalone adjusted YoY PAT is down roughly 12%, since the bulk of last year's impairment was booked at the standalone level — making the consolidated, adjusted (~flat) figure the more representative one.