Somi Conveyor (SOMICONVEY) Q2 FY27 Profit Rises 7% Despite a 30% Drop in Revenue
The conveyor belt maker's quarterly profit grew sequentially even as sales fell sharply, highlighting a focus on cost control amid a broader demand slowdown.
Somi Conveyor Beltings posted a 6.7% sequential rise in net profit to ₹0.64 crore for Q2 FY27. This came despite a 28.5% year-on-year drop in revenue to ₹14.1 crore, as the company managed expenses to improve its net profit margin.
For a capital goods supplier like Somi Conveyor, the top line is a direct pulse of industrial activity. This quarter, that pulse weakened further, with revenue falling nearly 30% from last year. Yet, the company managed to squeeze out a higher profit, a sign of disciplined cost management in a tough market.
Revenue & profit
Revenue (₹ Cr)
Net Profit (₹ Cr)
Net Profit Margin
Metric
CurrentQ2 FY27
PreviousQ1 FY27
Same quarter LYQ2 FY26
Revenue (₹ Cr)
14.1YoY -29%
15.62
19.73
Net Profit (₹ Cr)
0.64YoY -26%
0.60
0.86
Net Profit Margin
4.6%YoY +4.5%
3.8%
4.4%
The table shows a clear trend: revenue has been on a downtrend for three consecutive quarters. Sequentially, sales fell another 9.7%. The profit story is different, with a 6.7% quarter-on-quarter increase lifting the net profit margin by 80 basis points.
Where the costs were cut
The profit uptick was entirely driven by a sharper fall in total expenses, which dropped 11% from the prior quarter. Employee costs, however, rose 7.2% and depreciation increased 32% year-on-year, reflecting recent capacity investments. The company completed a new mixing line at its Tanawara plant in FY26, a project costing ₹8.65 crore, according to a report from scanx.trade.
This new capacity is meant to support timely order execution and improve product quality. But for now, it adds to the fixed cost base without a corresponding revenue lift, pressuring margins on a smaller sales base.
The demand question
Research from StockFin.ai suggests the company is in a “consolidation and stabilization phase,” with revenue trending lower. The broader conveyor belt market in India is expected to grow, driven by infrastructure and e-commerce, as noted in industry reports. Yet, Somi’s recent performance indicates it is not capturing that growth, pointing to possible execution delays or competitive pressures.
With no fresh order announcements in recent months, the revenue weakness may persist. The stock’s 47.5% decline over the past year, closing at ₹81.66 on November 13, reflects this concern.
Key Points
Revenue declined for the third straight quarter, down 28.5% year-on-year, signaling persistent softness in demand.
Net profit grew 6.7% sequentially as total expenses fell faster than sales, improving the net profit margin to 4.6%.
Recent capital expenditure adds depreciation costs without an immediate revenue boost, creating a near-term margin headwind.
The stock has significantly underperformed, down nearly 50% over the past year, pricing in the operational challenges.
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Hexa Perspective
This quarter presents a classic squeeze: revenue is contracting while the company bears the cost of recently added capacity. The sequential profit gain is a positive sign of operational control, but it is a defensive move, not a growth story.
The path forward hinges on order inflow converting the new capacity into sales. Until that visibility improves, the company remains in a holding pattern, managing a smaller business for profitability while the market waits for a demand catalyst.
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Frequently asked questions
What were Somi Conveyor's Q2 FY27 results?
Somi Conveyor Beltings reported Q2 FY27 revenue of ₹14.1 crore, a 28.5% decline from the same quarter last year. Net profit for the quarter was ₹0.64 crore, which was a 6.7% increase from the previous quarter (Q1 FY27). The net profit margin improved to 4.6%.
Why did Somi Conveyor's revenue decline nearly 30% year-on-year in Q2 FY27?
Somi Conveyor's revenue fell 28.5% year-on-year to ₹14.1 crore in Q2 FY27. The decline is part of a broader trend, with revenue dropping for three consecutive quarters, as noted by analysis from StockFin.ai, indicating a period of demand softness and stabilization for the company.
What drove the 6.7% sequential profit growth at Somi Conveyor despite a 9.7% drop in revenue in Q2 FY27?
Somi Conveyor's profit grew 6.7% sequentially in Q2 FY27 because total expenses fell 11% quarter-on-quarter, a sharper drop than the 9.7% decline in revenue. This cost control allowed the net profit margin to expand by 80 basis points to 4.6%.
Why did Somi Conveyor's net profit margin improve 80 basis points sequentially in Q2 FY27?
Somi Conveyor's net profit margin improved to 4.6% in Q2 FY27, up 80 basis points from the prior quarter. The improvement was driven by effective cost management, as total expenses decreased by 11% sequentially, outpacing the 9.7% decline in quarterly revenue.
What caused the 32% year-on-year increase in depreciation for Somi Conveyor Beltings in Q2 FY27?
Depreciation rose 32% year-on-year in Q2 FY27 to ₹0.46 crore. This increase is linked to recent capital expenditure, including a new mixing line at the Tanawara plant completed in FY26, as reported by scanx.trade. The investment adds to the fixed cost base.
What was Somi Conveyor Beltings' management commentary and guidance in the Q2 FY27 earnings call?
The available research snippets do not contain specific management commentary or forward guidance from Somi Conveyor's Q2 FY27 earnings call. Analysis from StockFin.ai notes a lack of strategic disclosure, which increases uncertainty about the company's recovery path.
What is the current order book and order inflow situation for Somi Conveyor Beltings?
The research does not provide details on Somi Conveyor's current order book or recent order inflows for Q2 FY27. The absence of new order announcements in recent months, coupled with declining revenue, suggests order inflow may be subdued.
What are Somi Conveyor Beltings' ongoing capex plans and capacity expansion projects?
Somi Conveyor recently completed the installation of a new mixing line at its Tanawara plant in FY26. The project, costing ₹8.65 crore according to scanx.trade, enhances compounding capacity for all conveyor belt grades, including steel cord belts, aiming to improve order execution and product quality.
What is the current demand and pricing environment for industrial conveyor belts in India?
Industry reports, such as those cited by Justdial, indicate the Indian conveyor belt market is experiencing growth driven by infrastructure development, automation, and e-commerce. However, Somi Conveyor's recent declining revenue suggests it may not be fully capturing this broader market demand currently.
How is Somi Conveyor Beltings' steel cord conveyor belt segment performing?
The research does not provide a segment-wise breakdown of performance. The company's product guides highlight steel cord belts as a key offering for long-distance, heavy-duty conveying, but consolidated results do not separate this segment's contribution.
Did Somi Conveyor Beltings Q2 FY27 results beat or miss analyst estimates?
The research sources, including xflot.com, explicitly state they provide filed figures with no analyst estimates, beats, or misses. Therefore, a comparison against published analyst estimates for Somi Conveyor's Q2 FY27 is not available from the provided information.
Which brokerages have changed their rating or target price for Somi Conveyor after Q2 FY27 results?
The provided research does not contain information on brokerage rating or target price changes for Somi Conveyor Beltings following the Q2 FY27 results. Sources like XMarketRadar note that external analyst estimates are unavailable in their feed.
Are institutional investors increasing or decreasing their stake in Somi Conveyor Beltings?
Data from DalalOS shows promoter holding has remained steady at 59.09% from September 2025 to September 2026. Detailed data on Foreign Institutional Investor (FII) or Domestic Institutional Investor (DII) stakes for recent quarters is not consistently published in the available filings.
How did Somi Conveyor Beltings' stock price react on the day of the Q2 FY27 results?
The results were announced on November 14, 2026. The last available price before the announcement was ₹81.66 on November 13. Specific intraday movement on the results date is not detailed in the provided research snippets.
Somi Conveyor Beltings Q2 profit drop
Somi Conveyor Beltings' net profit for Q2 FY27 was ₹0.64 crore. This represents a 25.6% drop compared to the net profit of ₹0.86 crore in the same quarter last year (Q2 FY26), reflecting the impact of significantly lower revenue during the period.
