HD Fire Q2 PAT rises 41% as revenue grows 29% year-on-year

HD Fire Protect reported Q2FY27 profit after tax of Rs 28.887 crore, up 41.04% year-on-year, while revenue from operations rose 28.79% to Rs 127.336 crore. HD Fire attributed revenue growth to higher demand, deeper market penetration and new project orders, despite higher bronze, steel and shipment costs.

What drove HD Fire's Q2FY27 revenue growth?

HD Fire's Q2FY27 revenue growth was driven by higher demand, deeper market penetration and onboarding of new project orders. Revenue from operations reached Rs 127.336 crore, compared with Rs 98.872 crore in Q2FY26 and Rs 109.052 crore in Q1FY27, representing 28.79% year-on-year and 16.77% quarter-on-quarter growth.

Profit grew faster than sales in Q2FY27. Earnings before interest, tax, depreciation and amortisation (EBITDA), excluding other income, increased 29.22% year-on-year to Rs 37.541 crore, while profit after tax (PAT) rose from Rs 20.482 crore to Rs 28.887 crore. PAT margin increased to 22.69% from 20.72% a year earlier.

The quarter-on-quarter result also showed higher operating profit. EBITDA rose 26.29% from Rs 29.725 crore in Q1FY27, and PAT increased 20.18% from Rs 24.037 crore. Other income fell to Rs 3.309 crore from Rs 5.016 crore sequentially, while depreciation increased to Rs 2.504 crore from Rs 2.207 crore.

How did input and freight costs affect HD Fire's margins?

Higher raw-material and shipment costs reduced HD Fire's gross margin in Q2FY27. Cost of goods sold increased to Rs 68.279 crore from Rs 49.351 crore in Q2FY26, as the company reported volatility in bronze and steel prices, supply-chain constraints and elevated shipment costs. Gross profit rose 19.26% to Rs 59.057 crore, slower than revenue growth of 28.79%.

Gross profit margin consequently declined to 46.38% in Q2FY27 from 50.09% in Q2FY26 and 49.04% in Q1FY27. Chairman and Managing Director Harish Narshi Dharamshi said cost-optimisation measures and pricing premiums supported by long-standing customer relationships partly mitigated input-cost volatility.

Operating expenses moved differently from production costs during the quarter. Employee-benefit expense rose to Rs 11.628 crore from Rs 10.209 crore a year earlier, while other expenses declined to Rs 9.888 crore from Rs 10.260 crore. EBITDA margin therefore rose by 0.10 percentage points year-on-year to 29.48%, although gross margin fell by 3.71 percentage points.

What does HD Fire's first-half performance show?

HD Fire's H1FY27 revenue increased 22.52% to Rs 236.388 crore and PAT rose 12.26% to Rs 52.928 crore. In H1FY26, revenue was Rs 192.936 crore and PAT was Rs 47.146 crore. EBITDA grew 16.68% to Rs 67.267 crore from Rs 57.649 crore in the prior-year half.

First-half margins remained below the previous year's levels. Gross margin declined to 47.60% in H1FY27 from 50.38% in H1FY26, while EBITDA margin fell to 28.46% from 29.88%. PAT margin decreased to 22.39% from 24.44%, contrasting with the year-on-year improvement in Q2FY27 PAT margin.

Domestic sales accounted for 64.37% of H1FY27 revenue, while exports represented 35.63%. During the half year ended 30 September 2026, HD Fire introduced three product ranges: UL Listed Fire Sprinklers K11.2, FM Approved Air Release Valves and UL Listed Pressure Gauges, including models HDP2-S, HDP3, HDP3-S, HDP4 and HDP4-S.

Why is HD Fire's second half usually larger?

HD Fire's second half is usually larger because domestic project execution and closures tend to be concentrated in the March quarter. Management says customers commonly accelerate completion of planned capital expenditure near the end of the financial year, and H2 generally contributes about 55% to 60% of annual revenue.

The FY26 revenue split illustrates that pattern. H1FY26 revenue was Rs 192.936 crore, or 39% of the annual total, while H2FY26 revenue was Rs 296.345 crore, or 61%. H1FY27 revenue reached Rs 236.388 crore, and Dharamshi said demand remained steady across quarters as the company entered H2.

The September 2026 quarter was followed by HD Fire's stock-market listing. The company listed on the National Stock Exchange and BSE on 21 October 2026, following an initial public offering subscription of 132 times. The listing occurred after Q2FY27 and therefore did not contribute to revenue or PAT recorded for the quarter.

What changed in HD Fire's cash flow and balance sheet?

HD Fire generated Rs 71.068 crore of net cash from operating activities in the half year ended 30 September 2026, compared with Rs 22.574 crore in the corresponding 2025 period. Cash generated from operations increased to Rs 91.499 crore from Rs 40.731 crore, while working-capital changes turned positive at Rs 20.988 crore from a negative Rs 18.577 crore.

Cash and cash equivalents stood at Rs 15.45 crore at 30 September 2026, compared with Rs 12.11 crore a year earlier and Rs 14.874 crore at 31 March 2026. The half-year statement recorded a Rs 17.924 crore net investing outflow and a Rs 52.569 crore net financing outflow, resulting in a Rs 57.6 lakh increase in cash during the period.

Inventories increased to Rs 112.389 crore at 30 September 2026 from Rs 87.355 crore at 31 March 2026, while trade receivables declined to Rs 52.33 crore from Rs 93.713 crore. Total assets rose to Rs 446.195 crore from Rs 431.895 crore, while trade payables increased to Rs 34.092 crore from Rs 29.784 crore.

Conclusion

HD Fire delivered Q2FY27 revenue growth of 28.79% and PAT growth of 41.04%, reaching Rs 127.336 crore and Rs 28.887 crore respectively. The result combined higher demand and new project orders with an EBITDA margin of 29.48%, even as gross margin declined to 46.38% amid raw-material and freight pressures.

The next period to watch is H2FY27, which management says generally supplies 55% to 60% of annual revenue, with domestic project closures concentrated in the March quarter. The outcome will show whether this seasonal revenue pattern, alongside the three product ranges introduced by 30 September 2026, supports the first-half margin profile.