Karamtara Engineering Q2 FY27 Results Analysis: Revenue Jumps 72%, EBITDA Margin Compresses 206 bps

Karamtara Engineering Ltd's Q2 FY27 numbers came in mixed, with revenue of Rs. 1,580.93 Cr (+72.29% YoY) and PAT growth of +45.29% YoY. Here's a quick read of what worked, what to watch, and what management said.

Quarter Snapshot

Revenue grew 72.29% YoY to Rs 1,580.93 crore with the USA geography nearly tripling to Rs 976.68 crore and now contributing 61.78% of sales, while PAT grew 45.29% to Rs 87.37 crore. EBITDA margin compressed 206 bps YoY to 10.99% as other expenses surged 132.60% YoY to 31.49% of revenue, though margin rebounded 336 bps QoQ from Q4FY26's 7.63% trough. The company completed its IPO at Rs 254 per share post-quarter and enters FY27 with an expanded equity base and the Bhachau facility operational, with no prior guidance disclosed against which to benchmark results.

Key Investment Insights

Key Positives

• Revenue grew 72.29% YoY to Rs 1,580.93 crore and 25.77% QoQ
• USA revenue rose 158.75% YoY to Rs 976.68 crore, now 61.78% of total revenue vs 41.13% a year ago
• PAT grew 45.29% YoY to Rs 87.37 crore; EPS rose to Rs 2.99 from Rs 2.06
• EBITDA grew 45.14% YoY to Rs 173.81 crore; margin expanded 336 bps QoQ from Q4FY26's 7.63%
• Material cost as % of revenue fell from 64.21% to 48.91%; combined material-plus-inventory cost improved 5.5 pp
• Finance cost as % of revenue fell from 3.30% to 2.61%
• India revenue grew 21.81% YoY to Rs 530.95 crore
• IPO completed at Rs 254 per share with listing on September 17, 2026; Rs 75 crore raised via CCPS at Rs 310 per share

Risk Factors

• EBITDA margin compressed 206 bps YoY to 10.99% (from 13.05%), below the FY26 annual margin of 11.55%
• Other expenses surged 132.60% YoY to Rs 497.76 crore, rising from 23.32% to 31.49% of revenue
• Rest-of-World revenue declined 29.69% YoY to Rs 73.30 crore
• Inventory-change swing of ~Rs 118 crore between periods distorts margin comparability
• Depreciation rose 103.61% YoY to Rs 19.58 crore following capacity expansion