Leapfrog Engineering Services profit falls 26% as revenue rises

Leapfrog Engineering Services Limited reported a 26% year-on-year fall in profit to Rs 4.49 crore for the half-year ended September 30, 2026, despite revenue from operations rising 68% to Rs 64.41 crore. Total expenses increased to Rs 61.13 crore from Rs 33.20 crore, exceeding the Rs 25.58 crore increase in total income.

Why did Leapfrog Engineering Services profit fall despite higher revenue?

Leapfrog Engineering Services’ profit for the period declined to Rs 4.49 crore in the half-year ended September 30, 2026, from Rs 6.10 crore a year earlier, while revenue from operations rose from Rs 38.37 crore to Rs 64.41 crore. Profit before tax decreased 28% to Rs 6.20 crore from Rs 8.55 crore.

Total income increased to Rs 67.33 crore from Rs 41.75 crore, as the growth in operating revenue offset a fall in other income to Rs 2.91 crore from Rs 3.38 crore. Total expenses rose by Rs 27.93 crore to Rs 61.13 crore, compared with a Rs 25.58 crore increase in total income.

Earnings per share, or EPS, fell to Rs 0.36 from Rs 0.57 in the corresponding half-year. Leapfrog Engineering Services said half-yearly EPS uses weighted average issued share capital and is not annualised.

Which costs increased at Leapfrog Engineering Services?

Leapfrog Engineering Services’ material-consumption cost rose to Rs 41.10 crore from Rs 17.43 crore, the largest absolute increase among reported expenses. Material consumption represented about 64% of revenue from operations in the latest half-year, compared with about 45% in the half-year ended September 30, 2025, based on the reported figures.

Employee benefit expenses increased to Rs 7.02 crore from Rs 4.90 crore, finance costs rose to Rs 3.55 crore from Rs 2.41 crore, and depreciation and amortisation increased to Rs 0.95 crore from Rs 0.20 crore. In contrast, contract execution expenses decreased to Rs 5.07 crore from Rs 6.53 crore, while other expenses fell to Rs 4.03 crore from Rs 4.82 crore.

The inventory movement provided a Rs 0.58 crore credit in the latest half-year, compared with a Rs 3.09 crore credit a year earlier. These changes left total expenses up about 84% year on year, ahead of the 68% increase in revenue from operations.

Which businesses generated Leapfrog Engineering Services revenue?

Leapfrog Engineering Services generated Rs 51.53 crore from contract revenue in the half-year ended September 30, 2026, up from Rs 34.75 crore a year earlier. Contracts remained the largest business, contributing about four-fifths of the Rs 64.41 crore revenue from operations.

Sale of services increased to Rs 12.82 crore from Rs 1.28 crore, while sale of products declined to Rs 0.06 crore from Rs 2.34 crore. The reported revenue mix therefore moved towards services while contracts remained the principal contributor.

Contract segment profit decreased to Rs 6.83 crore from Rs 11.09 crore, while service segment profit increased to Rs 9.70 crore from Rs 0.04 crore. Unallocated corporate expenses rose to Rs 9.05 crore from Rs 4.24 crore, and operating profit was Rs 7.44 crore against Rs 7.57 crore before finance costs and other income.

How has Leapfrog Engineering Services used IPO proceeds?

Leapfrog Engineering Services had utilised Rs 69.00 crore of Rs 79.60 crore received from its initial public offer, or IPO, by September 30, 2026, leaving Rs 10.60 crore unutilised. The IPO opened on June 17, 2026, closed on June 19, 2026, and its shares were listed on the BSE SME Platform on June 24, 2026.

Leapfrog Engineering Services issued 3,46,08,000 equity shares at Rs 23 each, including a premium of Rs 22 per share. Its disclosure said there were no deviations or variations in the utilisation of IPO proceeds during the half-year, while the Audit Committee and Board approved revised allocation of issue objects on August 21, 2026.

Working-capital requirements had received Rs 36.81 crore, or 99.98% of the allocated amount, by September 30, 2026. Capital expenditure for an assembling unit had received Rs 16.71 crore, or 61.89%, leaving Rs 10.29 crore pending, while general corporate purposes had received Rs 9.15 crore, or 96.79%.

What changed in Leapfrog Engineering Services’ balance sheet?

Leapfrog Engineering Services’ shareholders’ funds increased to Rs 146.12 crore at September 30, 2026, from Rs 72.84 crore at March 31, 2026. Share capital rose to Rs 14.18 crore from Rs 10.72 crore, while reserves and surplus increased to Rs 131.95 crore from Rs 62.12 crore.

Property, plant and equipment increased to Rs 14.07 crore from Rs 0.93 crore, while intangible assets rose to Rs 13.25 crore from Rs 0.14 crore. Cash and bank balances increased to Rs 25.42 crore from Rs 8.99 crore, and short-term loans and advances rose to Rs 44.44 crore from Rs 21.17 crore.

Total assets stood at Rs 253.38 crore at September 30, 2026, compared with Rs 166.72 crore at March 31, 2026. Long-term borrowings rose to Rs 3.54 crore from Rs 0.54 crore, short-term borrowings increased to Rs 38.58 crore from Rs 31.33 crore, and trade receivables declined to Rs 99.72 crore from Rs 107.07 crore.

Conclusion

Leapfrog Engineering Services’ half-year results combined a Rs 26.04 crore increase in revenue from operations with a Rs 1.61 crore decline in profit for the period. Higher material consumption, employee costs, finance costs and depreciation coincided with an increase in total expenses that exceeded the growth in total income.

The next disclosed item to watch is the deployment of Rs 10.29 crore pending for the assembling-unit capital expenditure as of September 30, 2026. Leapfrog Engineering Services also had Rs 10.60 crore of total IPO proceeds unutilised at that date, and its statutory auditor issued an unmodified limited-review opinion on the results approved on November 12, 2026.