Krishna Defence Q2 margin hits record 26.9% as profit rises 120.4%

Krishna Defence & Allied Industries Limited reported a record standalone earnings before interest, tax, depreciation and amortisation (EBITDA) margin of 26.9% in Q2FY27, up 786 basis points year on year. Revenue rose 55.7% to Rs 75.29 crore, while net profit increased 120.4% to Rs 15.12 crore, outpacing sales growth.

What drove Krishna Defence’s record Q2FY27 EBITDA margin?

Krishna Defence recorded EBITDA of Rs 20.25 crore in Q2FY27, compared with Rs 9.21 crore in Q2FY26, producing 119.9% year-on-year growth and a 26.9% margin. The company identifies this as its highest-ever EBITDA margin, following a 19.0% margin in the corresponding quarter a year earlier.

Revenue from operations increased to Rs 75.29 crore from Rs 48.36 crore in Q2FY26, a gain of 55.7%. Total expenditure rose at a lower 40.6% rate, to Rs 55.04 crore from Rs 39.16 crore. That difference between revenue and expenditure growth coincided with the 786-basis-point expansion in EBITDA margin. A basis point is one-hundredth of a percentage point.

Cost of goods sold rose 42.7% to Rs 38.82 crore in Q2FY27 from Rs 27.20 crore a year earlier. Employee benefit expense was broadly unchanged at Rs 5.40 crore versus Rs 5.42 crore, while other expenses increased 65.7% to Rs 10.82 crore. Despite the increase in other expenses, the Rs 26.93 crore rise in quarterly revenue exceeded the Rs 15.88 crore increase in total expenditure.

How did Krishna Defence’s Q2FY27 profit compare with earlier periods?

Krishna Defence’s Q2FY27 net profit was Rs 15.12 crore, up from Rs 6.86 crore in Q2FY26 and Rs 11.67 crore in Q1FY27. The year-on-year increase was 120.4%, while profit rose 29.6% sequentially from the immediately preceding quarter, based on the standalone income statement.

The net profit margin reached 20.1% in Q2FY27, compared with 14.2% in Q2FY26, an improvement of 590 basis points. It was marginally below the 20.3% recorded in Q1FY27. Profit before tax increased 125.4% year on year to Rs 20.59 crore, while tax rose 140.4% to Rs 5.47 crore from Rs 2.28 crore.

Other income increased to Rs 1.71 crore in Q2FY27 from Rs 65 lakh in Q2FY26, while depreciation rose to Rs 1.25 crore from Rs 67 lakh. Interest expense was Rs 12 lakh, the same amount as in Q1FY27, compared with Rs 5 lakh a year earlier. Reported earnings per share rose 121.0% to Rs 10.12 from Rs 4.58.

How did Krishna Defence perform in the first half of FY27?

Krishna Defence reported first-half FY27 revenue of Rs 132.89 crore, up 14.3% from Rs 116.28 crore in H1FY26. EBITDA increased faster, by 62.3%, to Rs 35.41 crore from Rs 21.82 crore, lifting the H1FY27 EBITDA margin to 26.6% from 18.8%.

Total expenditure in H1FY27 increased 3.2% to Rs 97.48 crore, compared with Rs 94.46 crore in H1FY26. Cost of goods sold was nearly flat, rising 0.8% to Rs 71.50 crore, while employee benefit expense rose 1.5% to Rs 10.33 crore. Other expenses increased 17.3% to Rs 15.65 crore from Rs 13.34 crore.

Net profit for H1FY27 was Rs 26.79 crore, an increase of 71.3% from Rs 15.64 crore in H1FY26. The net profit margin rose 671 basis points to 20.2% from 13.5%. Profit before tax increased 70.5% to Rs 35.49 crore, and the tax charge rose 68.2% to Rs 8.70 crore.

The reported quarterly figures show EBITDA rising from Rs 15.16 crore at a 26.3% margin in Q1FY27 to Rs 20.25 crore at a 26.9% margin in Q2FY27. Revenue also increased sequentially, from Rs 57.60 crore in Q1FY27 to Rs 75.29 crore in Q2FY27. The second-quarter margin was therefore 0.6 percentage points above the first-quarter level.

What business developments did Krishna Defence disclose after Q2FY27?

Krishna Defence reported an unexecuted order book of Rs 109 crore and a tender pipeline of Rs 305 crore as of September 30, 2026. The presentation describes the order book as strong and stable and says the tender pipeline represents opportunities under active pursuit; it does not state the timing or certainty of conversion into revenue.

During Q2FY27, Krishna Defence signed a memorandum of understanding with a defence prime for the development and supply of ammunition components. It also signed a memorandum of understanding with Pitagone, Belgium, to manufacture barriers for export to Belgium. The presentation does not disclose contract values for either arrangement.

Krishna Defence received transfer of technology from CSIR-Goa for the JAYA Autonomous Underwater Vehicle (AUV). It also won the Indian Navy’s iDEX challenge to develop and manufacture weld consumables for underwater welding, and the Drishti challenge involving special steel products for Yantra India Limited.

Krishna Defence additionally secured two developmental contracts from the Indian Navy for platforms supporting intelligence, surveillance and reconnaissance (ISR) and anti-submarine warfare (ASW) capabilities. Its infrastructure presentation lists an upcoming Chennai AUV integration and testing facility with a 15 lakh-litre testing tank and about 85,000 square feet of assembly and integration space.

Conclusion

Krishna Defence’s Q2FY27 figures show profitability rising faster than revenue: sales grew 55.7% to Rs 75.29 crore, EBITDA rose 119.9% to Rs 20.25 crore, and net profit rose 120.4% to Rs 15.12 crore. The resulting 26.9% EBITDA margin was 786 basis points above Q2FY26 and 0.6 percentage points above Q1FY27.

The next figures to watch are progress against the Rs 109 crore unexecuted order book and Rs 305 crore tender pipeline reported as of September 30, 2026. Krishna Defence’s disclosed initiatives include ammunition components, Belgian barrier exports, the JAYA AUV technology transfer, and two Indian Navy developmental contracts, while the Chennai AUV facility remains upcoming.