Euro India Fresh Foods (EIFFL) Q2 FY27 Profit Nears Zero as Costs Soar
The snack maker's revenue fell 8% year-on-year, but a sharp rise in employee, interest and depreciation costs pushed net profit to just ₹0.09 crore.
Euro India Fresh Foods reported a sharp decline in quarterly profit to just ₹0.09 crore as rising costs overwhelmed a shrinking revenue base. The company's net profit margin contracted sharply from the previous quarter.
For a small food processor, quarterly swings are normal, but the September quarter for Euro India Fresh Foods showed costs rising faster than sales could cover. Revenue slipped 8% from a year ago to ₹29.92 crore, but profit nearly vanished, falling to just ₹0.09 crore.
The numbers tell a story of pressure from all sides. While total expenses fell year-on-year, key fixed costs jumped dramatically.
Revenue & profit
Revenue (₹ Cr)
Profit (₹ Cr)
Net Profit Margin
| Metric | CurrentQ2 FY27 (Sep 2026) | PreviousQ1 FY27 (Jun 2026) |
|---|---|---|
| Revenue (₹ Cr) | 29.92 | 36.06 |
| Profit (₹ Cr) | 0.09 | 0.74 |
| Net Profit Margin | 0.3% | 2.1% |
Why the bottom line disappeared
A small ₹0.97 crore in other income kept the quarter in the black. Without it, the pre-tax line would have been negative. The real squeeze came from operating costs that rose even as sales shrank.
Employee costs surged 32% year-on-year, while interest expense more than doubled. Depreciation leapt 209%, a sign of recent capital spending. A report from StoxGud notes the company's debt-to-equity stood at 0.62, with operating profit covering interest less than two times.
The capacity question
This cost surge is tied to an expansion phase. According to a StockScans report, the company is shifting to a larger leased plant in Navsari. Sector Alpha data shows capital expenditure of ₹18.0 crore in FY26, with ₹4.0 crore of work still in progress.
The new capacity is not yet earning, but the costs of financing and depreciating it are hitting the income statement now. This creates a profitability gap that only higher, sustained sales can fill.
A volatile path ahead
The company's revenue has swung wildly, from ₹60.02 crore in March 2026 to ₹29.92 crore this quarter. This volatility, noted in a Univest preview, makes consistent margins difficult. The stock trades at a P/E of 149.4, a 303% premium to its industry, pricing in a major future improvement.
Key Points
- Quarterly profit collapsed to ₹0.09 crore as employee, interest and depreciation costs rose sharply.
- Revenue declined 8% year-on-year and 17% sequentially, continuing a pattern of high quarterly volatility.
- High capital expenditure for a plant move is adding fixed costs before new revenue is realized.
- The stock's high valuation premium assumes a significant and sustained earnings recovery.
Hexa Perspective
The quarter highlights the execution risk in Euro India Fresh Foods' growth plan. Costs from its capacity expansion are real and current, while the sales needed to justify them remain elusive and choppy.
The company must demonstrate it can not only ramp up the new facility but also secure larger, steadier orders to absorb the higher fixed cost base. Until sales volatility subsides, quarterly profitability will likely remain hostage to these mounting overheads.
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