Pitti Engineering commits ₹450 Cr to consolidate laminations capacity as adjusted profit slips 15%

Between 6:27 pm and 8:24 pm on October 22, Pitti Engineering's board meeting produced a stack of exchange filings: unaudited Q2 and H1 FY27 results, a ₹2-per-share interim dividend, senior-management re-designations — and the one that resets the investment case, a ₹450 crore capex approval to consolidate the company's lamination manufacturing in Karnataka into a single integrated facility. All of it reached the exchange after the close, so the first session that can trade on the news is October 23. The stock went in at ₹949.20, already 22.7% below its 52-week high of ₹1,228 set on September 7.

The basis change matters for reading the numbers. In September 2026 the company merged its two subsidiaries — Pitti Industries Private Limited and Dakshin Foundry Private Limited — into the parent, effective September 23 following an NCLT Hyderabad order sanctioning the scheme. Q2 and H1 FY27 are therefore standalone figures covering the whole former group, and the fairest year-ago comparison is the old consolidated quarter.

The decline is largely a non-operating story. Revenue from operations grew 21.1% year-on-year (₹578.4 Cr against the year-ago consolidated ₹477.7 Cr), and adjusted EBITDA — which strips out other income — grew 13.6%. But the gap between total income and operating revenue, a proxy for other income, collapsed from ₹21.3 Cr in Q2 FY26 to ₹2.1 Cr this quarter (computed from the filed P&L). That ₹19.2 Cr swing is bigger than the entire ₹8.6 Cr fall in pre-tax profit. Interest cost actually came in lower, at ₹16.3 Cr versus ₹19.4 Cr a year ago. The operating engine, on these numbers, grew; the headline profit decline came from what sits around it.

The half-year tells the same story with less noise: H1 FY27 income of ₹1,110.5 Cr is up 15.3%, adjusted EBITDA of ₹180.1 Cr is up 13.6% at a 16.3% margin, and adjusted PAT of ₹68.2 Cr is essentially flat at −0.4%. Alongside the results, the board declared an interim dividend of ₹2 per share (40% on the ₹5 face value), record date Monday November 2, payable on or before November 21.

The press release adds detail the Regulation 30 annexure doesn't: the ₹450 Cr goes into a new greenfield facility in Bengaluru, with land acquisition planned and interim capacity to be added in phases at existing and leased premises. The target state — 1,60,000 MT of sheet metal and 13.14 lakh machining hours by FY31 — is a 48% capacity addition on laminations and a 61% addition on machining over today's installed base, layered on top of the machining expansion already in flight. The filing states the mode of financing as internal accruals and debt. Holders are, in effect, being asked to fund a multi-year build-out from a quarter in which adjusted profit fell — the company's case is that ~78–85% utilisation and the demand it cites across railways, data centres, mining and power generation leave it little choice but to add capacity ahead of the orders.

The filings land on a tape that has been falling for six weeks: from the September 7 close of ₹1,176.20 to ₹949.20 on October 22, a 19.3% slide. Part of it has a traceable trigger — on October 8 the company disclosed, after market close, that Maharashtra State GST officials had begun an inspection or search at its Maharashtra manufacturing unit under Section 67 of the state GST Act; the next session the stock fell 4.0%. The company's October 14 follow-up stated the proceeding concluded on October 13 at 11:30 pm, that it extended full co-operation, and that there was no material impact on financials or operations. The rest of the drift has no single filing attached to it. Promoter holding, for reference, was unchanged at 54.18% across the March and June 2026 quarters.