EIL consultancy margin reaches 31% as turnkey drops to 4%

EIL reported a 31% consultancy segment profit margin in Q2 FY26-27, compared with 4% for turnkey. Consultancy turnover rose to Rs 594.4 crore and segment profit reached Rs 183.6 crore, while turnkey turnover was Rs 208 crore and segment profit was Rs 9 crore. The margin gap was 27 percentage points.

Why did EIL’s consultancy margin reach 31% in Q2 FY26-27?

EIL’s consultancy margin reached 31% in Q2 FY26-27 as the segment reported Rs 183.6 crore of profit on turnover of Rs 594.4 crore. The presentation does not specify the operational reasons for the margin movement. It reports a 28% consultancy margin in Q2 FY25-26, when consultancy turnover was Rs 411.3 crore and segment profit was Rs 116.4 crore.

Consultancy turnover increased by Rs 183.1 crore from Q2 FY25-26 to Q2 FY26-27, while segment profit increased by Rs 67.2 crore. The reported margin rose by 3 percentage points year on year, from 28% to 31%. Consultancy also became the larger of EIL’s two operating segments by turnover, accounting for 74% of consultancy-plus-turnkey turnover in Q2 FY26-27, compared with 46% a year earlier.

The 31% quarterly margin was above the 24% reported in Q1 FY26-27, when consultancy turnover was Rs 499 crore and segment operating profit was Rs 119.7 crore. It was also above the 17%, 28% and 22% recorded in Q1, Q2 and Q3 FY25-26, respectively. However, it remained below the 51% consultancy margin reported in Q4 FY24-25.

In H1 FY26-27, consultancy turnover was Rs 1,093.4 crore, compared with Rs 819.425 crore in H1 FY25-26. Domestic consultancy turnover was Rs 720.546 crore and overseas consultancy turnover was Rs 372.854 crore in the latest half year. Overseas consultancy turnover had been Rs 143.925 crore in H1 FY25-26, according to the standalone presentation.

Why did EIL’s turnkey margin fall to 4%?

EIL’s turnkey margin fell to 4% in Q2 FY26-27, with segment profit of Rs 9 crore on turnover of Rs 208 crore. This compared with a 5% margin, Rs 24.3 crore of segment profit and Rs 489.1 crore of turnover in Q2 FY25-26. The presentation does not provide a stated explanation for the reduction in turnover or margin.

Turnkey turnover declined by Rs 281.1 crore year on year, while turnkey segment profit decreased by Rs 15.3 crore. The reported margin declined by 1 percentage point from 5% to 4%. Turnkey represented 26% of the consultancy-plus-turnkey turnover mix in Q2 FY26-27, down from 54% in Q2 FY25-26.

The Q2 FY26-27 result was also below the 8% turnkey margin reported in Q1 FY26-27. In that preceding quarter, turnkey turnover was Rs 301.9 crore and segment operating profit was Rs 22.7 crore. Turnkey’s turnover share was 38% in Q1 FY26-27, meaning its share fell by 12 percentage points in the following quarter.

The quarterly record shows substantial variation in turnkey profitability before Q2 FY26-27. EIL reported a 38% turnkey margin and Rs 273.7 crore of segment operating profit in Q3 FY25-26, followed by an 8% margin and Rs 33.1 crore of profit in Q4 FY25-26. The Rs 208 crore turnkey turnover in Q2 FY26-27 was the lowest among the 10 quarters displayed from Q1 FY24-25.

How did the segment mix affect EIL’s Q2 FY26-27 profit?

EIL’s profit after tax, or PAT, increased to Rs 179.75 crore in Q2 FY26-27 from Rs 114.908 crore in Q2 FY25-26, although total income declined to Rs 879.3 crore from Rs 948.2 crore. The presentation shows this PAT movement alongside consultancy’s 74% turnover share and 31% margin, while turnkey’s share was 26% and its margin was 4%.

Profit before tax, or PBT, was Rs 229.456 crore in Q2 FY26-27, compared with Rs 149.579 crore in Q2 FY25-26. Earnings per share, or EPS, rose to Rs 3.20 from Rs 2.04. All these measures are standalone figures, as are the turnover, segment-profit and segment-margin figures used in the comparison.

Consultancy segment profit increased by Rs 67.2 crore year on year, while turnkey segment profit declined by Rs 15.3 crore. The change in segment profit was therefore concentrated in consultancy, whose turnover grew while turnkey turnover contracted. Other income was Rs 77 crore in Q2 FY26-27, compared with Rs 47.8 crore in Q2 FY25-26.

The reported mix changed materially over the same period. Consultancy turnover rose from Rs 411.3 crore to Rs 594.4 crore, whereas turnkey turnover fell from Rs 489.1 crore to Rs 208 crore. Total income fell by Rs 68.9 crore even as PAT increased by Rs 64.842 crore, illustrating that the presentation’s quarter-on-quarter outcome was not driven by total income growth.

What does EIL’s H1 FY26-27 performance show?

EIL’s H1 FY26-27 figures show that the consultancy-led turnover mix extended beyond Q2. Consultancy turnover was Rs 1,093.4 crore and turnkey turnover was Rs 509.829 crore, making consultancy 68% of the two segments’ turnover. In H1 FY25-26, consultancy represented 47% and turnkey represented 53%.

Consultancy segment profit was Rs 303.295 crore in H1 FY26-27, up from Rs 184.63 crore in H1 FY25-26. Turnkey segment profit was Rs 31.669 crore, down from Rs 49.316 crore in the prior-year first half. The combination of rising consultancy profit and lower turnkey profit mirrors the Q2 direction, although the presentation does not publish H1 segment-margin percentages.

Total income was Rs 1,717.296 crore in H1 FY26-27, below Rs 1,840.351 crore in H1 FY25-26. Consultancy turnover increased by Rs 273.975 crore over that period, while turnkey turnover declined by Rs 428.297 crore. Other income rose to Rs 114.067 crore from Rs 82.801 crore.

EIL’s business secured during H1 FY26-27 was Rs 7,428.3 crore, including Rs 5,761.9 crore for consultancy and Rs 1,666.4 crore for turnkey. Overseas consultancy accounted for Rs 5,481.9 crore of the consultancy business secured. In Q2 FY26-27 alone, EIL secured Rs 6,914.7 crore of business, including Rs 5,394.7 crore of consultancy and Rs 1,520 crore of turnkey work.

Conclusion

EIL’s Q2 FY26-27 results show a clear divergence between its two operating segments. Consultancy delivered a 31% margin, Rs 594.4 crore of turnover and Rs 183.6 crore of segment profit, while turnkey delivered a 4% margin, Rs 208 crore of turnover and Rs 9 crore of segment profit. This mix shift coincided with PAT rising to Rs 179.75 crore despite lower total income.

The next development to watch is conversion of EIL’s order book into segment turnover. As of September 2026, EIL reported a total standalone order book of Rs 20,420.5 crore, of which consultancy represented 75% and turnkey 25%. Overseas consultancy accounted for Rs 11,417.6 crore of the order book, while the presentation does not disclose a segment-margin target or a timetable for conversion.