BLUESTONE Q2 FY27 Results Analysis: PAT Swings to Profit, Revenue Jumps 43.9%

BLUESTONE's Q2 FY27 numbers came in strong. Here's a quick read of what worked, what to watch, and what management said.

Quarter Snapshot

Revenue grew 43.9% YoY with reported EBITDA margin expanding 483 bps to 13.2% and standalone PAT swinging to Rs.1.75 Cr from a Rs.-49.11 Cr loss, confirming operating leverage is flowing to the bottom line. All management targets (SSSG ~30%, ~20% distribution growth, Pre-IndAS margin path) are tracking on plan with no explicit guidance beats. Rising net debt (Rs.539.5 Cr), negative FCF, and a consolidated loss from subsidiaries are the key watch items.

Key Investment Insights

Key Positives

• Revenue grew 43.9% YoY to Rs.738.09 Cr; H1 FY27 revenue of Rs.1,471.28 Cr grew 46.3% YoY
• Reported EBITDA of Rs.97.2 Cr grew 127.3% YoY with margin expanding 483 bps to 13.2%
• Pre-IndAS EBITDA (excl. inventory gain) of Rs.53.5 Cr grew 234.2% YoY with margin up 413 bps to 7.3%
• Standalone PAT swung from Rs.-49.11 Cr loss (Q2 FY26) to Rs.1.75 Cr profit; Adjusted PAT of Rs.19.6 Cr vs Rs.-26.8 Cr loss a year ago
• SSSG of 28.0% vs 11.1% a year ago; customer base crossed 1 million (10,24,220, +19.3% YoY)
• A&P at 6.0% of revenue vs 8.2% a year ago; absolute spend +5.7% YoY vs revenue +43.9%
• ESOP charge declined 49.8% YoY from Rs.27.7 Cr to Rs.13.9 Cr
• Cash PAT of Rs.45.4 Cr grew 639.2% YoY from Rs.6.1 Cr

Risk Factors

• SSSG moderated to 28.0% from 39.0% in Q1 on September gold-price correction putting consumers in wait-and-watch mode
• Gross margin fell to 36.6% from 40.7% in Q1 and 39.5% a year ago
• Net debt rose to Rs.539.5 Cr (+Rs.85.9 Cr QoQ, +Rs.192.6 Cr H1); net debt/equity rose from 0.2 to 0.3; Rs.300 Cr NCD issuance approved
• ROCE declined from 8.6% to 7.2% (standalone)
• Consolidated entity reported a loss attributable to owners of Rs.-3.23 Cr, dragged by Ethereal House and Redefine Fashion (Rs.-4.98 Cr to owners)
• Inventory turnover of 1.16x remains well below the 1.7x four-year target