Gujarat Apollo Industries Q2 Profit Falls 16% Despite 55% Revenue Rise

Gujarat Apollo Industries Limited reported a 15.8% year-on-year fall in consolidated Q2 FY27 net profit to ₹1.97 crore, despite a 55.0% rise in revenue from operations to ₹19.98 crore. The decline reflected lower other income, higher finance costs and a ₹0.32 crore prior-year tax adjustment, while core operating performance improved as revenue volumes increased.

What were Gujarat Apollo's Q2 FY27 financial results?

Gujarat Apollo recorded consolidated revenue from operations of ₹19.98 crore in the quarter ended September 30, 2026, compared with ₹12.89 crore in the corresponding quarter of FY26. Revenue also more than doubled from ₹9.98 crore in Q1 FY27, representing 100.3% sequential growth.

Total income rose 28.7% year on year to ₹26.54 crore, while expenditure increased 34.0% to ₹23.64 crore. Profit before tax was ₹2.90 crore, up 3.1% from a year earlier and 76.3% from the preceding quarter. The board approved the unaudited standalone and consolidated results for the quarter and half year ended September 30, 2026, along with the limited review reports.

Why did Gujarat Apollo's net profit decline despite higher revenue?

Gujarat Apollo's reported net profit declined because of items below the operating line rather than a deterioration in revenue growth. Other income decreased to ₹6.57 crore from ₹7.74 crore in Q2 FY26, while finance costs increased to ₹1.11 crore from ₹0.95 crore.

The quarter also included a one-time ₹0.32 crore prior-year tax adjustment. Consolidated profit attributable to the company was ₹1.5684 crore, and the share of profit from an associate was ₹0.4054 crore, taking consolidated net profit to ₹1.97 crore. On the reported measure, this compared with ₹2.34 crore in Q2 FY26.

The tax adjustment materially affected the comparison. After excluding this one-off item, adjusted profit was estimated to be broadly flat year on year, with a decline of about 2.4%, compared with the reported 15.8% fall. This distinction is relevant because it separates the quarter-specific tax effect from the underlying performance of the business.

Did Gujarat Apollo's operating performance improve in Q2 FY27?

Gujarat Apollo's core operating performance improved year on year as stronger volumes helped absorb fixed costs. The operating profit measure excluding other income rose 21.3% from a year earlier and 37.3% sequentially, according to the reported quarterly comparisons.

Using the stated calculation of profit before tax plus depreciation and finance costs, less other income, operating margin excluding other income was negative 6.1% in Q2 FY27. However, it improved from negative 18.2% in Q2 FY26 and negative 34.5% in Q1 FY27. The movement indicates that the revenue increase supported better absorption of costs, even though the operating measure remained negative.

The reported net profit margin was 7.44%, compared with about 11.36% a year earlier and an improvement of 2.82 percentage points from Q1 FY27. The year-on-year margin contraction was therefore driven by lower other income, higher finance costs and the tax adjustment, rather than the revenue line alone.

How does the quarter compare with Gujarat Apollo's recent performance?

Gujarat Apollo's Q2 revenue rebound followed a weaker Q1 FY27, when revenue was ₹9.98 crore and net profit was ₹0.81 crore. Q1 revenue had declined 9.9% year on year, while net profit had fallen 29.6% from the corresponding quarter of FY26.

The sequential recovery in Q2 was substantial, with revenue up 100.3% and consolidated net profit up 144.7% from Q1. Earnings per share rose to ₹1.52 from the Q1 level, though it remained below ₹1.98 in Q2 FY26. The comparison shows that Q2 reversed the immediate sequential slowdown but did not fully restore the prior-year profit level.

The results also highlight the influence of non-operating income on quarterly profitability. Other income formed a significant part of total income in both the current and prior-year quarters. As a result, changes in that line item can affect reported profit even when revenue from operations rises sharply.

What does Gujarat Apollo's Q2 result mean for investors?

Gujarat Apollo's Q2 result presents a mixed financial picture for investors. Revenue growth of 55.0% and improved operating-cost absorption point to stronger activity during the quarter. At the same time, reported consolidated net profit fell 15.8%, and net margin declined by 3.92 percentage points from the year-earlier period.

The available results do not disclose a future revenue target, order book or profitability guidance. Investors assessing subsequent quarters will therefore need to track whether revenue growth is sustained, whether operating margin excluding other income continues to improve, and whether finance costs and other income move materially. The limited review reports were stated to be unmodified, and no loan defaults were disclosed in the supplied results summary.

Conclusion

Gujarat Apollo's Q2 FY27 performance was marked by a strong rise in revenue and a sequential recovery in profit, but reported year-on-year net profit was lower because of reduced other income, increased finance costs and a ₹0.32 crore prior-year tax adjustment. Core operating indicators improved, with the operating margin excluding other income becoming less negative than in both Q1 FY27 and Q2 FY26.

The next focus is whether the Q2 revenue level can be maintained and whether the improved cost absorption can further narrow the operating deficit. The company has not disclosed future targets in the supplied results material, leaving subsequent financial filings as the key source for updates on revenue, margins and profitability.