Sapphire Foods swings to ₹14 Cr profit as revenue climbs 15% YoY, margins expand

Sapphire Foods staged a clean turnaround in Q1 FY27, its first result since the appointed date of its merger into Devyani International. Consolidated revenue rose 14.7% YoY to ₹890.96 Cr (₹776.83 Cr a year ago) and the company swung to a net profit of ₹14.02 Cr, against a ₹1.74 Cr loss in the year-ago quarter and a ₹12.62 Cr loss last quarter. Crucially, this quarter carried NO exceptional item, unlike Q4 FY26 which bore a ₹12.80 Cr charge (scheme-of-arrangement costs plus a Labour Code provision) — so the profit is operationally clean, not a one-off artefact. Net margin improved to +1.57% from -0.22% YoY, and operating EBITDA margin expanded to roughly 15.7% from ~14.5% a year ago.

The topline print directly validates management's Q4 concall guidance of "reasonable" SSSG with restaurant EBITDA margins holding or improving: 14.7% YoY growth points to healthy same-store momentum from the KFC value/consumer-recruitment strategy carrying into the new year, and the margin expansion lands despite the LPG-cost (30-50 bps) and vendor-support (50-70 bps) headwinds management had flagged. Cost of materials at ₹278.06 Cr grew slower than revenue, aiding the gross-margin bridge. The standalone entity tells the same story — revenue ₹756.07 Cr, PAT ₹12.87 Cr, EPS ₹0.40 — so there is no divergence between the two bases.

The stock went into the print at ₹184.38, down 0.9% over the past month of trading.

For context: this is the highest quarterly PAT in the last 6 quarters on our records; revenue is at a 6-quarter high.

No pre-print street consensus surfaced (the result was released the same day as the board meeting), though Goldman Sachs had earlier raised FY27-28 estimates citing KFC strength. The dominant structural item remains the merger with Devyani International: shareholders receive 177 Devyani shares per 100 Sapphire shares, NSE/BSE 'no-objection' letters were received in June 2026, and the scheme awaits remaining regulatory/NCLT approvals — meaning this may be among the last standalone Sapphire prints. Other housekeeping this quarter: the registered office shift to Haryana was completed (ROC certificate May 18, 2026) and the 17th AGM was held July 21.