AWL Q2 FY27 Earnings Call: Guides Revenue Near Rs. 85,000 Cr, Food FMCG Jumps 32%

AWL held its Q2 FY27 earnings call on October 27, 2026. Here's a quick read of what management said — performance, strategy, and the outlook ahead.

Strong Top Line, Softer Bottom Line on Tax and Timing

• Revenue +26% YoY to Rs.22,202 Cr — Q2 FY 2026-2027 consolidated revenue on 14% volume growth; normalized operating EBITDA +11% YoY to Rs.623 Cr.
• PBT +4% YoY to Rs.344 Cr; PAT declined 2% YoY to Rs.239 Cr — management attributed the PAT decline to minimum corporate tax on Bangladesh subsidiary revenue under local regulations.
• H1 FY 2026-2027: revenue +22% to Rs.42,250 Cr — on 11% volume growth; normalized EBITDA +25% to Rs.1,378 Cr, PBT +27% to Rs.822 Cr, PAT +22% to Rs.591 Cr.
• PBT growth lagged revenue in Q2 — management attributed the gap to mark-to-market gains/losses shifting between quarters due to quarter/half-year cut-off reporting, with normalization expected over 2-4 quarter periods.
• Reporting note — normalized gross profit and EBITDA incorporate commodity derivatives hedging gains/losses (classified under other income/expenses under Indian accounting standards) to reflect underlying operating profitability.

Food & FMCG Leads; Industrial Essentials Beats Guidance

• Food & FMCG revenue +32% YoY to Rs.2,216 Cr — Q2 FY 2026-2027 EBITDA margin of 3.2%, within the FY 2026-2027 guidance range of 3-4%; Fortune Pulses grew over 40% YoY with quarterly revenue crossing Rs.100 Cr.
• Health & convenience portfolio LTM revenue exceeded Rs.1,400 Cr — rice and flour delivered double-digit revenue growth, with Basmati gaining share and Kohinoor growing double digits.
• Edible oil volumes +5% — market share maintained, led by mustard, groundnut and cottonseed oils; EBITDA of ~Rs.4,100 per MT, within the guided Rs.4,000-4,500 per MT range.
• Industrial Essentials volumes +25% — EBITDA of Rs.4,300 per MT came in ahead of the guidance range of Rs.3,000-3,500 per MT; oleochemicals and specialty chemicals now contribute ~45% of segment revenue.
• Management flagged the 26% Industrial Essentials growth as a one-off — driven by a parity opportunity in de-oiled cakes of mustard and soya, and not sustainable; H2 FY 2026-2027 guided at high single digit to low double digit growth, with Q3-Q4 FY 2026-2027 expected at 10-11%.

Quick Commerce, Branded Exports and Tops Expansion

• Quick commerce grew over 40% YoY; HoReCa +22% — Altem revenue crossed Rs.800 Cr; direct retail reach at 9.7 lakh outlets with total reach of ~26 lakh outlets.
• Branded exports grew 59% in Q2 FY 2026-2027 (72% YoY cited elsewhere in the call) — targeting markets with high Indian diaspora concentration: US, UK, Europe, Australia and the Indian subcontinent, where Fortune enjoys strong recall.
• Branded exports at ~Rs.800 Cr (FY 2026-2027) — a low base; management expects the margin-accretive business, which earns good export premiums, to become significant over the next couple of years on top line, volumes and bottom line.
• Tops (GD Foods) growing at 25%+ in GT Foods (FY 2026-2027) — remains concentrated in North India; management plans to target East and Central India over the next 1-1.5 years, with West and South entry considered only after those markets stabilize (no timeline committed).
• Channel mix: 75% general trade, 25% alternate channels — alternate channels are inherently more profitable, but promotion, scheme and fill-rate spending brings net profitability in line with GT; management is investing in modern trade, e-commerce and quick commerce and in urban towns to offset rural softness.

Inventory Build, Trade Credit Clarification, No Demerger

• H1 FY 2026-2027 inventory build-up of Rs.6,000 Cr — management corrected the analyst's Rs.600 Cr figure; driven by a sluggish September and sunflower supply chain disruption, with AWL deliberately holding extra sunflower inventory to protect its sunflower brand, funded via working capital lines (hence negative operating cash flow); normalization expected in Q3 FY 2026-2027.
• Elevated finance cost from inventory funding is recovered through pricing — management stated profitability has not been impacted despite the finance cost increase.
• CEO Shrikant Kanhere clarified the Rs.8,500 Cr trade credit (Q2 FY 2026-2027) — it is supplier's credit for imports and non-funded working capital (letters of credit where funds are committed only at payment), and should NOT be included in net debt calculations.
• No plans to demerge the Industry Essentials/oleochemicals business — management described it as a very significant part of the business, a forward integration of palm refining and integral to the palm value chain.
• Analyst Madhu Rati (Counter Cyclical Investments) suggested a share buyback — citing favorable valuation; management gave no commitment in response.

Monsoon Deficit, Inflation and Commodity Positioning

• Monsoon rainfall deficit of 12-13% across India — some territories at 30-40% deficit and wheat-belt states (Rajasthan, Haryana, Punjab) above 30%, which may impact kharif harvest and rabi sowing; management noted improved irrigation coverage over the last 15-20 years may help recover shortfalls.
• Headline CPI close to 6% with food inflation at 7-7.5% — poses a further demand risk, though festive season demand may negate these pressures; urban outgrew rural for AWL in Q2/H1 FY 2026-2027 (gap not staggering).
• Government reduced edible oil import duty in the last week of September 2026 — management said higher inventory should not impact Q3 FY 2026-2027 profitability as brand equity allows sustaining prices, though some impact is possible and expected to be recovered through pricing.
• El Niño in Indonesia may cause palm oil production impact and near-term price bullishness — but not "very high bullishness," per expert commentary cited by management; the company is prepared via its risk management structure.
• Wheat prices are rising, which management said is good for the company — given good inventory to maintain year-round quality and recover the carry; Government of India is holding sizably good wheat stocks and has all levers available to check rising prices.
• Management declined to give a wheat price or production outlook for Q3-Q4 FY 2026-2027 — rabi sowing is yet to happen and reported soil moisture levels are very low, so no prediction is possible until basic data is in hand.

Guidance Framework and FY 2026-2027 Outlook

• FY 2026-2027 volume growth guided at 8-9% — after 11% H1 growth, citing H2's festive-season pent-up demand for food FMCG (daily essentials), which management distinguishes from discretionary FMCG; management is hopeful of mid-single digit to high single digit volume growth in H2 FY 2026-2027.
• FY 2026-2027 revenue should be close to Rs.85,000 Cr if the run rate continues — with EBITDA guided close to Rs.2,600 Cr (~3% margin); management noted overall EBITDA margin currently at 2.6% (analyst cited Q2 margin of 1.1-1.2% vs ~2% in Q1 FY 2026-2027).
• Food & FMCG margin to be maintained within 3-4% for FY 2026-2027 — with an aspiration (not a commitment) to move toward high single-digit margin over the medium term, beginning FY 2027-2028 onwards.
• Edible oil guided to mid-single digit volume growth and gradual market share uptick — with EBITDA per MT within Rs.4,000-4,500 for FY 2026-2027; guidance framework is EBITDA-per-ton for edible oil and percentage margin for food.
• Food business guided to double digit and 25+ percent revenue growth (period unspecified) — after 28% growth in Q2 FY 2026-2027 and H1 volume/revenue growth of 24%/27%; management sees no issue with this trajectory.
• Government is implementing standardized pack sizes from September — management said standardized packs are always favorable for branded companies like AWL, creating a level playing field after FY 2025-2026 saw the edible oil industry's first-ever "grammage war"; volumes expected to increase to some extent.
• Management expects H2 FY 2026-2027 performance to be similar to H1 — Madhur brand currently sells only sugar, with no expansion into other products as of Q2 FY 2026-2027.