KPI Green Q2 profit falls 21% as finance costs rise

KPI Green Energy Limited reported consolidated profit after tax of Rs 91.9421 crore for the quarter ended September 30, 2026, down 21.2% from Rs 116.6429 crore a year earlier, although total revenue increased 15.7% to Rs 741.4954 crore. Interest expense, lease-finance cost and depreciation rose faster than income.

Why did KPI Green’s Q2 profit decline despite higher revenue?

KPI Green’s profit declined because total expenses rose faster than total revenue in the September 2026 quarter. Total revenue increased by Rs 100.3512 crore year on year, while total expenses increased by Rs 127.5751 crore to Rs 610.9647 crore. As a result, profit before tax fell 17.3% to Rs 130.5307 crore from Rs 157.7546 crore, and profit after tax fell by Rs 24.7008 crore.

Finance and asset-related charges accounted for much of the change. Interest expense rose to Rs 79.056 crore from Rs 33.0245 crore, lease-finance cost increased to Rs 13.2589 crore from Rs 9.9986 crore, and depreciation and amortisation climbed to Rs 60.3224 crore from Rs 31.6086 crore. These three costs together increased by Rs 77.0066 crore, against the Rs 100.3512 crore increase in total revenue.

Which businesses generated KPI Green’s September-quarter revenue?

KPI Green’s sales of power and solar power plant segment generated all reported segment revenue of Rs 727.2132 crore in the quarter ended September 30, 2026, up from Rs 633.4092 crore a year earlier. The plot-sales segment recorded no revenue in the quarter, compared with Rs 0.8887 crore in the September 2025 quarter.

The consolidated income statement shows growth in both principal operating lines. Revenue from sales of captive power projects rose to Rs 626.0124 crore from Rs 584.1642 crore, while revenue from sale of power and services increased to Rs 101.2008 crore from Rs 49.2451 crore. Captive power projects therefore remained the larger source of quarterly operating revenue.

Segment profit before tax and interest from power and solar power plants fell to Rs 148.6269 crore from Rs 172.2804 crore despite the higher revenue base. KPI Green reported an operating margin of 36.97%, versus 35.56% a year earlier. The company defines this measure as earnings before interest, tax, depreciation and amortisation, excluding other income, divided by revenue from operations.

How did KPI Green perform in the six months ended September 2026?

KPI Green’s revenue from operations for the six months ended September 30, 2026 rose 14.9% to Rs 1,421.0533 crore from Rs 1,237.2408 crore in the corresponding prior-year period. Total revenue increased to Rs 1,451.3108 crore from Rs 1,255.2631 crore, while profit after tax declined 18.2% to Rs 186.5751 crore from Rs 227.9593 crore.

The half-year figures show the same cost pattern as the quarter. Interest expense more than doubled to Rs 146.7972 crore from Rs 61.3478 crore, lease-finance cost rose to Rs 25.2663 crore from Rs 19.8733 crore, and depreciation and amortisation increased to Rs 111.2681 crore from Rs 61.1106 crore. The cash-flow statement reported total finance cost of Rs 172.0636 crore, compared with Rs 81.2210 crore a year earlier.

KPI Green’s reported net profit margin was 12.86% for the six-month period, down from 18.16%, while operating margin increased to 36.20% from 34.86%. Basic earnings per share were Rs 8.50, compared with Rs 10.80 in the prior-year half. The difference between the operating-margin and net-margin movements reflects the increased financing and depreciation charges reported during the period.

What do KPI Green’s balance sheet and cash flows show?

KPI Green’s total assets rose to Rs 12,036.9039 crore at September 30, 2026, from Rs 9,882.0637 crore at March 31, 2026. Capital work-in-progress increased to Rs 2,544.8418 crore from Rs 918.0379 crore, while property, plant and equipment stood at Rs 4,369.4744 crore. Net cash used in investing activities was Rs 1,482.3418 crore for the six months ended September 30.

Borrowings rose alongside the investment. Non-current borrowings increased to Rs 4,776.9048 crore from Rs 3,665.9979 crore at March 31, while current borrowings increased to Rs 1,183.6447 crore from Rs 865.9549 crore. The reported debt-equity ratio was 1.84 at September 30, compared with 1.49 at March 31 and 0.81 a year earlier.

KPI Green’s annualised interest-service coverage ratio, defined as earnings before interest, tax, depreciation and amortisation divided by interest expense, was 3.07 for the September quarter, versus 5.40 a year earlier. The annualised current ratio was 1.35, compared with 2.63 in the September 2025 quarter. The company also reported total debt-to-total-assets of 0.50, compared with 0.35 a year earlier.

How did working capital and debt security change at KPI Green?

KPI Green’s trade receivables increased to Rs 1,213.6936 crore at September 30, 2026, from Rs 791.8338 crore at March 31, 2026. Its reported debtor-turnover measure increased to 138 days from 98 days a year earlier, while inventories declined to Rs 1,275.9607 crore from Rs 1,449.1323 crore at March 31.

Net cash generated from operating activities increased to Rs 405.9164 crore in the six months ended September 30 from Rs 269.8972 crore in the corresponding period. The cash-flow statement included a Rs 218.7887 crore reduction in inventories and a Rs 227.7574 crore increase in trade payables, partly offset by a Rs 326.6264 crore increase in trade receivables.

KPI Green reported Rs 572.85 crore of secured, listed, rated and redeemable non-convertible debentures at September 30, 2026, compared with Rs 616.40 crore at March 31. The debenture trust deed requires minimum security cover of 1.20 times, and the company reported book-value security cover of 1.23 times. The stated collateral includes specified revenue-generating independent power producer projects, their receivables, cash inflows and escrow accounts.

Conclusion

KPI Green’s September-quarter result combined 15.7% growth in total revenue with a 21.2% fall in profit after tax. Sales of power and solar power plants reached Rs 727.2132 crore, but the increase in interest expense to Rs 79.0560 crore and depreciation to Rs 60.3224 crore reduced earnings after tax and lowered the reported net profit margin to 12.40% from 18.19%.

The disclosed matter to watch is the final purchase-price allocation for DEK and Maveriks Green Energy Limited. Sun Drops Energia Limited acquired 62.9% of its paid-up equity share capital on September 2, 2025 through a share-swap arrangement, and KPI Green said the group was still determining the fair value of identifiable assets and liabilities, with the business combination accounted for on provisional fair values.