Sandhar Q2 revenue rises 27% while net profit falls 24%

Sandhar Technologies Limited reported consolidated revenue from operations of Rs 1,617.68 crore for the quarter ended 30 September 2026, up 27% from Rs 1,270.37 crore a year earlier, while net profit after tax fell 24% to Rs 56.03 crore as other income declined and Sandhar recognised a Rs 2.78 crore one-time employee-benefit expense.

Why did Sandhar’s Q2 profit fall despite higher revenue?

Sandhar’s consolidated net profit after tax declined to Rs 56.03 crore in the quarter ended 30 September 2026 from Rs 73.38 crore in the quarter ended 30 September 2025, despite revenue increasing by Rs 347.31 crore. Profit before tax fell to Rs 74.31 crore from Rs 95.68 crore, while total comprehensive income decreased to Rs 57.73 crore from Rs 78.27 crore.

The year-on-year comparison was also affected by other income, which fell to Rs 6.47 crore from Rs 37.29 crore. During the quarter ended 30 September 2025, Sandhar completed the sale of Peenya plant assets for Rs 61 crore, generating a Rs 34.01 crore disposal gain that was recognised in other income. The assets had a carrying amount of Rs 26.99 crore when classified as held for sale at 31 March 2025.

Sandhar also recognised a one-time Rs 2.78 crore expense for increased gratuity and compensated-absence liabilities. The expense followed the Government of India’s notification of the four Labour Codes on 21 November 2025, which introduced a unified definition of wages for employee-benefit calculations under Indian Accounting Standard 19, or Ind AS 19.

How did Sandhar’s India and overseas segments perform?

Sandhar’s India segment delivered Q2 revenue of Rs 1,488.23 crore, compared with Rs 1,153.01 crore a year earlier, while overseas revenue rose to Rs 129.45 crore from Rs 117.36 crore. India therefore accounted for Rs 335.22 crore of the Rs 347.31 crore increase in consolidated revenue, with overseas operations adding Rs 12.09 crore.

India segment result, defined as profit before tax, exceptional items and interest, declined to Rs 91.09 crore from Rs 112.72 crore despite the revenue increase. Overseas segment result rose to Rs 1.39 crore from Rs 0.35 crore, or Rs 35 lakh, taking combined segment results to Rs 92.48 crore compared with Rs 113.07 crore in the prior-year quarter.

Finance costs increased to Rs 18.17 crore from Rs 17.39 crore. After finance costs, consolidated profit before tax was Rs 74.31 crore, down Rs 21.37 crore year on year. The segment figures show that the lower India segment result, rather than overseas operations, was the principal movement behind the reduction in combined segment earnings.

What do Sandhar’s first-half results and quarterly trend show?

Sandhar reported consolidated revenue from operations of Rs 2,999.57 crore for the six months ended 30 September 2026, compared with Rs 2,360.46 crore in the corresponding prior-year period. India revenue increased to Rs 2,741.35 crore from Rs 2,120.16 crore, while overseas revenue rose to Rs 258.22 crore from Rs 240.30 crore.

First-half profit before tax was Rs 125.45 crore, compared with Rs 131.99 crore a year earlier, and net profit after tax was Rs 93.31 crore against Rs 101.38 crore. The six-month comparison includes the prior-year period’s Rs 34.01 crore gain on the Peenya plant asset sale, while the current period includes the Rs 2.78 crore Labour Codes charge.

Quarter on quarter, revenue rose from Rs 1,381.89 crore in the quarter ended 30 June 2026 to Rs 1,617.68 crore in Q2. Net profit after tax increased from Rs 37.28 crore to Rs 56.03 crore, and profit before tax increased from Rs 51.14 crore to Rs 74.31 crore. This sequential improvement occurred even though Q2 other income of Rs 6.47 crore was below Rs 12.14 crore in the preceding quarter.

What changed in Sandhar’s balance sheet and cash flow?

Sandhar’s consolidated total assets rose to Rs 3,892.09 crore at 30 September 2026 from Rs 3,475.68 crore at 31 March 2026. Property, plant and equipment increased to Rs 1,299.52 crore from Rs 1,285.86 crore, while capital work-in-progress rose to Rs 181.92 crore from Rs 100.41 crore.

Working-capital balances expanded during the six months. Inventories increased to Rs 657.91 crore from Rs 559.84 crore, and trade receivables rose to Rs 986.78 crore from Rs 823.06 crore. Current borrowings were Rs 743.72 crore at 30 September 2026, compared with Rs 683.12 crore at 31 March 2026, while total liabilities rose to Rs 2,488.72 crore from Rs 2,142.55 crore.

Net cash generated from operating activities was Rs 168.54 crore in the six months ended 30 September 2026, compared with Rs 94.77 crore in the prior-year period. Investing activities used Rs 188.86 crore, including Rs 191.05 crore for property, plant and equipment, capital work-in-progress, intangible assets and business acquisition. Cash and cash equivalents were Rs 25.27 crore at period end, down from Rs 51.09 crore at 31 March 2026.

How did Sandhar’s standalone business compare with the group?

Sandhar’s standalone revenue from operations was Rs 792.14 crore in Q2, down from Rs 805.03 crore in the prior-year quarter, contrasting with the 27% increase in consolidated revenue. Standalone profit before tax declined to Rs 52.99 crore from Rs 94.70 crore, while standalone net profit after tax fell to Rs 38.89 crore from Rs 74.58 crore.

For the six months ended 30 September 2026, standalone revenue was Rs 1,458.10 crore versus Rs 1,533.15 crore a year earlier. Standalone net profit after tax was Rs 69.50 crore, compared with Rs 99.99 crore in the corresponding period. The difference between standalone and consolidated revenue movements reflects the inclusion of Sandhar’s subsidiaries, step-down subsidiaries and joint ventures in the group statement.

Sandhar’s consolidated entities included subsidiaries in India, Barcelona, Poland, Mexico and Romania, along with five joint ventures as at 30 September 2026. The limited review report said five subsidiaries represented Rs 578.04 crore of revenue before consolidation adjustments in Q2, while three unreviewed subsidiaries represented Rs 79.70 crore of revenue before consolidation adjustments.

Conclusion

Sandhar’s Q2 results show that consolidated sales growth did not translate into higher year-on-year profit. Revenue increased by Rs 347.31 crore, led by the India segment, but net profit declined by Rs 17.35 crore as other income was lower than the asset-sale-affected prior-year quarter and the group booked the Rs 2.78 crore Labour Codes employee-benefit expense.

The next disclosures will show how Sandhar’s Rs 181.92 crore of capital work-in-progress develops and whether receivables of Rs 986.78 crore and inventories of Rs 657.91 crore remain aligned with revenue growth. Shareholders approved a final dividend of Rs 4 per equity share at the annual general meeting on 22 September 2026.