Kirloskar Ferrous Q2 revenue hits Rs 2,046.7 crore, margin 10.9%

Kirloskar Ferrous reported standalone revenue from operations of Rs 2,046.7 crore in Q2 FY27, up 17% year on year and the highest result across the six reported quarters. Earnings before interest, tax, depreciation and amortisation (EBITDA) rose to Rs 223.0 crore, but its margin fell to 10.9% as material costs reached 57.7% of revenue.

Why did Kirloskar Ferrous revenue rise in Q2 FY27?

Kirloskar Ferrous increased Q2 FY27 revenue through higher sales across pig iron, castings and steel, alongside a sequential recovery in tubes. Revenue from operations for the quarter ended September 30, 2026 was Rs 2,046.7 crore, compared with Rs 1,755.3 crore in Q2 FY26 and Rs 1,771.5 crore in Q1 FY27. This represented growth of 17% year on year and 16% quarter on quarter.

The Q2 FY27 outcome exceeded the prior five reported quarterly revenue figures, which ranged from Rs 1,618.0 crore in Q3 FY26 to Rs 1,817.2 crore in Q4 FY26. Total income, including other income, reached Rs 2,066.0 crore from Rs 1,759.8 crore a year earlier. Other income was Rs 19.3 crore in Q2 FY27, compared with Rs 4.4 crore in Q2 FY26.

Castings and steel generated the fastest annual sales growth among the reported product lines. Castings sales rose 30% year on year to Rs 633 crore, while steel sales increased 48% to Rs 206 crore. Pig iron sales rose 20% to Rs 581 crore, tube sales were unchanged year on year at Rs 568 crore, and sales classified as others declined 26% to Rs 59 crore.

Which products drove Kirloskar Ferrous volume growth?

Kirloskar Ferrous recorded the largest volume gains in steel and castings during Q2 FY27. Steel volume grew 34% year on year to 26,606 metric tonnes, while castings volume increased 20% to 47,888 metric tonnes. Compared with Q1 FY27, steel volume rose 18% from 22,633 metric tonnes and castings volume rose 16% from 41,345 metric tonnes.

Pig iron volume increased 3% year on year and 5% sequentially to 134,940 metric tonnes in Q2 FY27. Tube volume recovered 17% from Q1 FY27 to 48,547 metric tonnes, but remained 2% below the 49,588 metric tonnes reported in Q2 FY26. All four product categories recorded higher volume than in Q1 FY27, while tubes were the only category with lower annual volume.

Realisation increased across every disclosed product in Q2 FY27. Pig iron realisation rose 16% year on year to Rs 43,054 per metric tonne, castings realisation increased 8% to Rs 132,192 per metric tonne, and steel realisation rose 11% to Rs 77,523 per metric tonne. Tube realisation increased 3% to Rs 116,953 per metric tonne, supporting unchanged year-on-year tube sales despite the lower volume.

The presentation described domestic demand for castings as strong and sustained, and reported record passenger-vehicle wholesales driven by sport-utility vehicles and premiumisation. It also cited strong passenger and commercial vehicle output, demand for precision bearings and machinery, and alloy-steel production growth in the first half. These sectors are the disclosed market context for Q2 FY27 product volumes and realisations.

Why did Kirloskar Ferrous EBITDA margin fall to 10.9%?

Kirloskar Ferrous' EBITDA margin fell to 10.9% in Q2 FY27 as material costs took a larger share of revenue. Material costs were 57.7% of revenue, compared with 53.7% in Q1 FY27 and 55.2% in Q2 FY26. The Q2 FY27 margin was below each of the preceding five reported quarterly margins, which ranged from 11.5% to 12.8%.

EBITDA still increased in rupee terms to Rs 223.0 crore from Rs 214.4 crore in Q2 FY26 and Rs 215.7 crore in Q1 FY27. Revenue grew faster than EBITDA, producing the lower margin. Cost of materials consumed was Rs 1,159.8 crore, up from Rs 1,014.1 crore a year earlier and Rs 1,005.1 crore in the previous quarter.

Other expenses increased to Rs 534.2 crore in Q2 FY27 from Rs 474.6 crore in Q2 FY26, while employee-benefit expense rose to Rs 109.0 crore from Rs 97.1 crore. Power costs declined sequentially to 8.0% of revenue from 9.3% in Q1 FY27, but were above the 7.7% reported in Q4 FY26. The figures show a sequential improvement in the power-cost share but an increase in material-cost share.

The presentation identified imported coking coal as an input-cost risk, stating that landed prices jumped sharply in September before easing slightly while remaining volatile. It also said rupee depreciation increased imported coking-coal prices. The presentation does not allocate the Rs 154.7 crore year-on-year increase in material costs to individual inputs, so the specific contribution of coking coal is not disclosed.

How did Kirloskar Ferrous profit and first-half performance compare?

Kirloskar Ferrous reported standalone profit after tax of Rs 97.6 crore in Q2 FY27, compared with Rs 88.5 crore in Q2 FY26 and Rs 82.3 crore in Q1 FY27. Profit before tax before exceptional items was Rs 137.8 crore, up from Rs 119.9 crore a year earlier and Rs 134.4 crore sequentially. Finance costs were Rs 34.0 crore, compared with Rs 32.6 crore in Q2 FY26 and Rs 29.5 crore in Q1 FY27.

For H1 FY27, revenue from operations was Rs 3,818.2 crore, up from Rs 3,453.4 crore in H1 FY26. EBITDA rose to Rs 438.7 crore from Rs 431.3 crore, while the EBITDA margin was 11.5%. That first-half margin was below the 12.2% reported for FY26 and equal to the 11.5% reported for FY25.

H1 FY27 profit after tax was Rs 179.9 crore, compared with Rs 324.0 crore in H1 FY26. The standalone statement records exceptional items of Rs 29.3 crore for H1 FY27, all of which were recorded in Q1 FY27, while no exceptional item was reported in H1 FY26. EBITDA is stated excluding other income and before exceptional items, making it distinct from the post-exceptional profit comparison.

For FY26, Kirloskar Ferrous reported revenue of Rs 6,888.6 crore, EBITDA of Rs 841.8 crore and an EBITDA margin of 12.2%. H1 FY27 revenue of Rs 3,818.2 crore was more than half of FY26 revenue, but the presentation did not disclose a full-year FY27 revenue, EBITDA or margin target.

Conclusion

Kirloskar Ferrous paired Rs 2,046.7 crore of Q2 FY27 revenue with growth in pig iron, castings and steel sales, while castings and steel also led volume expansion. However, the increase in material costs to 57.7% of revenue reduced EBITDA margin to 10.9%, despite EBITDA rising to Rs 223.0 crore and profit after tax reaching Rs 97.6 crore.

The next reported periods will show whether demand remains supported by the infrastructure, construction, automotive and precision-engineering activity cited for the second half. Management's presentation identified volatile landed coking-coal prices and rupee-related increases in imported coal costs as unresolved factors, and it did not provide a FY27 revenue or profitability target.