Carysil (CARYSIL) Q2 FY27 Profit Squeeze Undercuts a Strong Sales Quarter
The kitchen and bath products maker posted 14.6% revenue growth, but a sharp rise in costs pushed net profit margin down 170 basis points sequentially.
Carysil's Q2 FY27 saw revenue climb to ₹275.7 crore, but profit fell 9.5% from the previous quarter. Higher material and employee costs compressed margins, even as the company pushes ahead with capacity expansions.
For a manufacturer running factories near capacity, revenue growth is the easy part. Carysil’s challenge this quarter was keeping that top-line momentum from being eaten by costs, and the numbers show it lost some ground.
The September quarter revenue rose 14.6% year-on-year to ₹275.73 crore. Profit, however, slipped 9.5% from the June quarter to ₹29.01 crore. The net profit margin compressed to 10.5%, down 170 basis points sequentially.
Revenue & profit
Revenue (₹ Cr)
Profit (₹ Cr)
Net Profit Margin (%)
| Metric | CurrentQ2 FY27 | PreviousQ1 FY27 | Same quarter LYQ2 FY26 |
|---|---|---|---|
| Revenue (₹ Cr) | 275.73YoY +15% | 262.14 | 240.67 |
| Profit (₹ Cr) | 29.01YoY +5.8% | 32.05 | 27.42 |
| Net Profit Margin (%) | 10.5YoY -7.9% | 12.2 | 11.4 |
Where the growth went
Revenue growth was driven by higher sales volumes, according to a scanx.trade report. But the cost of materials consumed rose faster than sales, and employee expenses jumped 16.2% year-on-year. Total expenses grew 14.9%, outpacing revenue.
This squeezed the EBITDA margin to 18.8%, down from 19.2% a year ago. The sequential margin drop was sharper, reflecting the full quarterly impact of these cost pressures that began building earlier.
The capacity bridge
Higher depreciation, up 20.3% year-on-year, signals ongoing capital expenditure. Management has guided for ₹80-90 crore in capex this year to add 250,000 granite and 150,000 stainless steel sink units by March 2027, as noted by StockFin.ai.
The factory is reportedly running seven days a week to meet demand. This expansion is critical to relieve capacity constraints and capture the domestic growth opportunity, which ICICI Securities sees as a central thesis.
The market's read
Carysil’s revenue of ₹275.7 crore came in slightly above the supplied consensus estimate of ₹270 crore, according to Multibagg.ai. The stock trades at a P/E of 21.8, a significant discount to the industry average of 44.2.
Domestic institutional investors have been steady buyers, raising their stake for five consecutive quarters to 12.1% as of September 2026, per SectorAlpha data. This suggests long-term confidence outweighs near-term margin concerns.
Key Points
- Revenue growth of 14.6% YoY was overshadowed by a 9.5% QoQ drop in profit due to cost inflation.
- Net profit margin fell 170 basis points sequentially to 10.5% as material and employee costs rose faster than sales.
- The company is executing an ₹80-90 crore capex plan to significantly expand sink capacity by the end of FY27.
- Domestic institutional ownership has risen for five straight quarters, indicating institutional faith in the long-term story.
Hexa Perspective
This quarter frames Carysil’s current phase: it is a growth story navigating a cost squeeze. The revenue beat shows demand is not the issue; execution and margin defense are.
The coming quarters hinge on two factors. First, whether operating leverage from new capacity, slated for March 2027, can offset persistent input cost pressures. Second, if the strong domestic growth, which grew 39.8% in Q1, can sustain and improve the overall sales mix. The valuation discount prices in the margin risk, but the expansion timeline remains the key execution test.
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