Basilic Fly H1 profit falls 47.5% as revenue rises 11.4%

Basilic Fly Studio Limited reported first-half financial year 2027 (H1-FY27) consolidated profit after tax of Rs 13.9 crore, down 47.5% year on year, although revenue from operations rose 11.4% to Rs 210.9 crore. Operating expenses grew faster than revenue, the operating EBITDA margin fell 564 basis points, and depreciation more than doubled following Q2-FY27 capitalisation.

Why did Basilic Fly’s H1-FY27 profit decline despite revenue growth?

Basilic Fly’s H1-FY27 consolidated profit declined because costs and depreciation rose faster than sales. Revenue from operations increased by Rs 21.5 crore from Rs 189.4 crore in H1-FY26 to Rs 210.9 crore, while operating expenses rose by Rs 28.4 crore from Rs 145.5 crore to Rs 173.9 crore. As a result, operating earnings before interest, tax, depreciation and amortisation, or operating EBITDA, fell 15.7% to Rs 37 crore from Rs 43.9 crore.

The lower operating result was followed by higher depreciation and finance cost. Depreciation increased 102.9% to Rs 13.8 crore from Rs 6.8 crore, while finance cost rose 25% to Rs 5 crore from Rs 4 crore. Profit before tax consequently declined 50.8% to Rs 15.7 crore, despite exceptional items increasing 39.3% to Rs 3.9 crore. Tax expense decreased to Rs 1.8 crore from Rs 5.4 crore, but this did not offset the reduction in profit before tax.

How far did margins contract in H1-FY27?

Basilic Fly’s consolidated operating EBITDA margin fell to 17.54% in H1-FY27 from 23.18% a year earlier, a contraction of 564 basis points. The company recorded an 11.4% increase in consolidated revenue, but its 19.5% increase in operating expenses exceeded that sales growth. The presentation attributes quarterly operating-margin pressure to a revenue mix led by overseas business, which it describes as a comparatively lower-margin segment.

The profit after tax margin contracted more sharply, to 6.55% from 13.87%, a decline of 732 basis points. The presentation attributes the year-on-year fall in profit after tax margin primarily to the depreciation impact of Q2-FY27 capitalisation. The presentation calculates profit after tax margin using total income, comprising revenue from operations and other income; other income declined to Rs 1.4 crore in H1-FY27 from Rs 1.6 crore in H1-FY26.

The standalone result showed a different operating-margin profile but also lower earnings. H1-FY27 standalone revenue rose 2.4% to Rs 55.8 crore and operating EBITDA remained unchanged at Rs 27 crore, while operating EBITDA margin declined 115 basis points to 48.39%. Standalone profit after tax fell 33.5% to Rs 11.3 crore as depreciation rose 278.6% to Rs 10.6 crore.

What does the Q2-FY27 result show about the second quarter?

Basilic Fly’s second-quarter financial year 2027 (Q2-FY27) consolidated revenue increased 12.8% year on year to Rs 107.4 crore, but profit after tax nearly halved to Rs 7.3 crore. Operating EBITDA declined 11.1% to Rs 22.5 crore from Rs 25.3 crore, and the operating EBITDA margin decreased to 20.95% from 26.58%. The company stated that overseas business drove Q2 growth and that this segment carries comparatively lower margins.

Depreciation was a notable quarterly drag, rising 142.9% to Rs 8.5 crore from Rs 3.5 crore. Other income moved to a negative Rs 1.3 crore from positive Rs 1 crore, while exceptional items fell to Rs 1 crore from Rs 2.7 crore. These items contributed to a 47.3% decline in profit before tax to Rs 9.6 crore and a 49.7% decline in profit after tax to Rs 7.3 crore.

The sequential picture was more favourable at the operating level. Compared with first-quarter financial year 2027 (Q1-FY27), Q2 revenue increased 3.8% from Rs 103.5 crore, operating EBITDA rose 56.3% from Rs 14.4 crore, and operating EBITDA margin improved 704 basis points from 13.91%. Profit after tax increased 10.6% from Rs 6.6 crore, while depreciation rose 60.4% from Rs 5.3 crore, indicating that the quarter-on-quarter improvement did not reverse the year-on-year depreciation effect.

What operating developments could affect Basilic Fly’s future mix and costs?

Basilic Fly delivered domestic theatrical production Jailer 2 and five marquee international titles in the period, including Ahsoka Season 2 for Lucasfilm and Disney+, Practical Magic 2 for Warner Bros. Pictures, and Elsinore for StudioCanal and Apple TV+. The company said its portfolio strategy is to gradually expand domestic tentpole productions while maintaining its position in international series, with the stated aim of driving margins.

The company also disclosed infrastructure initiatives intended to alter production workflows and cloud use. Its Chennai on-site build combined with cloud-burst capacity was completed, and management said this reduced cloud costs by 50% while retaining the ability to scale at peak demand. Basilic Fly has also begun a phased Universal Scene Description rollout on a live production and said its NetApp storage system is live and performing to expectations.

Workforce measures include the completion of a talent boot camp programme, with 90% of trainees inducted into live production. Basilic Fly said its internal teams have received editing and pipeline technical training to support a planned global data support centre in Chennai. These disclosures describe operational programmes, but the presentation provides no quantified earnings or margin target for their impact in H2-FY27.

Conclusion

Basilic Fly’s H1-FY27 figures show that consolidated revenue growth did not translate into higher earnings. Revenue rose Rs 21.5 crore year on year, but operating expenses increased Rs 28.4 crore, operating EBITDA fell Rs 6.9 crore, and depreciation rose Rs 7 crore. This combination reduced profit after tax by Rs 12.6 crore and lowered the profit after tax margin to 6.55%.

The next disclosed operational milestone is the Bengaluru studio expansion, scheduled to become operational from January 2027. Management is targeting the new studio to account for 40% of total work as headcount doubles. Readers can watch whether the planned capacity expansion, domestic tentpole work, overseas revenue mix and the stated 50% cloud-cost reduction change the cost and margin trends reported in H1-FY27.