Rainbow Children's Medicare Q2 FY27 results: net profit up 10.9% to ₹83.89 crore, revenue up 23.2%

How did Rainbow Children's Medicare perform in Q2 FY27?

Consolidated revenue for the July–September 2026 quarter was ₹548.02 crore, against ₹444.80 crore in Q2 FY26 and ₹469.99 crore in Q1 FY27. That was a rise of ₹103.22 crore, or 23.2%, year on year and ₹78.03 crore, or 16.6%, from the previous quarter. Total income was ₹556.15 crore, up ₹103.16 crore or 22.8% from a year earlier.

EBITDA was ₹169.98 crore, compared with ₹148.86 crore in Q2 FY26 and ₹134.64 crore in Q1 FY27, so the year-on-year rise was ₹21.12 crore or 14.2% and the sequential rise ₹35.34 crore or 26.2%. The EBITDA margin was 31.0%, down 2.5 percentage points from 33.5% a year earlier but up 2.4 percentage points from 28.6% in the previous quarter. Profit before tax was ₹111.50 crore, up ₹9.13 crore or 8.9% year on year.

Net profit was ₹83.89 crore, up ₹8.27 crore or 10.9% from ₹75.62 crore in Q2 FY26 and ₹21.35 crore or 34.1% from ₹62.54 crore in Q1 FY27. The PAT margin was 15.3%, against 17.0% a year earlier and 13.3% in the previous quarter. Basic EPS was ₹8.1, up ₹0.69 or 9.3% from ₹7.41 and ₹2.13 or 35.7% from ₹5.97. On the standalone basis, revenue was ₹486.99 crore and PAT was ₹75.09 crore, against profit before tax of ₹73.17 crore in the year-ago quarter.

What changed in Rainbow Children's Medicare's costs and profit?

Total expenses rose to ₹444.64 crore from ₹350.62 crore in Q2 FY26, an increase of ₹94.02 crore or 26.8%, which was higher than the 23.2% rise in revenue. Cost of materials consumed increased ₹11.56 crore or 18.6% to ₹73.77 crore, employee benefits expense rose ₹16.40 crore or 27.9% to ₹75.18 crore, and finance costs rose ₹3.15 crore or 16.7% to ₹22 crore.

Depreciation and amortisation increased ₹8.77 crore or 24.5% to ₹44.61 crore, while other expenses rose ₹54.16 crore or 31.0% to ₹229.10 crore. The earnings presentation reported professional fees to doctors of ₹1,403.0 million, up 32.0% from ₹1,063.2 million a year earlier, and other expenses of ₹888.0 million, up 29.4% from ₹686.2 million. There was no exceptional item in the quarter.

Other income was ₹8.13 crore, lower by ₹0.07 crore or 0.9% from ₹8.20 crore in Q2 FY26, while tax expense was ₹27.61 crore, higher by ₹0.86 crore or 3.2% from ₹26.75 crore. Against the previous quarter, other income fell ₹4.58 crore or 36.0% from ₹12.71 crore, and tax rose ₹6.20 crore or 29.0% from ₹21.41 crore.

How did the first half of FY27 go?

In the first half of FY27, consolidated revenue was ₹1,018.01 crore against ₹797.73 crore in H1 FY26, a rise of ₹220.28 crore or 27.6%. Total income was ₹1,038.84 crore, up ₹212.90 crore or 25.8% from ₹825.94 crore. The earnings presentation put H1 FY27 EBITDA at ₹3,046.3 million against ₹2,524.9 million a year earlier.

Profit before tax for the first half was ₹195.46 crore, up ₹21.72 crore or 12.5% from ₹173.74 crore, and PAT was ₹146.43 crore, up ₹17.00 crore or 13.1% from ₹129.43 crore. Basic EPS was ₹14.07, compared with ₹12.68 in H1 FY26. Total expenses rose ₹212.90 crore or 29.3% from ₹6,522.0 million to ₹8,433.9 million, with the presentation showing professional fees to doctors up 33.3% to ₹2,641.2 million.

What do the balance sheet and cash flow show?

Total assets stood at ₹2,958.55 crore on 30 September 2026, against ₹2,774.84 crore at 31 March 2026, and total equity was ₹1,735.87 crore against ₹1,663.59 crore. Borrowings were nil at both dates, while cash was ₹32.55 crore against ₹33.89 crore. Inventories rose to ₹53.7 crore from ₹41.63 crore, trade receivables to ₹133.41 crore from ₹103.18 crore, and trade payables to ₹126.57 crore from ₹100.57 crore.

Operating cash flow for H1 FY27 was ₹217.77 crore, compared with ₹207.59 crore in H1 FY26. Investing cash flow was negative ₹86.95 crore against negative ₹124.81 crore, and financing cash flow was negative ₹132.16 crore against negative ₹76.22 crore. Capital expenditure was ₹138.17 crore in H1 FY27 against ₹302.27 crore a year earlier. The company also said cash, cash equivalents, fixed deposits and mutual fund investments totalled Rs. 5,428 Mn. as of September 30, 2026, and that planned capital expenditure would be met from internal resources.

How has Rainbow Children's Medicare done over the last 8 quarters?

Revenue has risen year on year in each of the last eight quarters, and profit has risen year on year in each of the last four quarters. Over the period shown, revenue was lowest at ₹352.93 crore in Q1 FY26 and highest at ₹548.02 crore in Q2 FY27. PAT bottomed at ₹53.8 crore in Q1 FY26 and peaked at ₹83.89 crore in Q2 FY27.

The EBITDA margin moved from 33.8% in Q3 FY25 to 29.4% in Q1 FY26, then rose to 33.5% in Q2 FY26 and 31.0% in Q2 FY27 after dipping to 28.6% in Q1 FY27. The current quarter therefore shows revenue and profit at their highest in the series, with margin recovering from the previous quarter but still below the year-ago level.

What else did the company announce?

The board met on 31 October 2026 and approved the unaudited standalone and consolidated financial results for the quarter and half year ended September 30, 2026. The signed results were filed with a limited review report from S.R. Batliboi & Associates LLP. An earnings presentation and press release were filed the same day.

The same-day filings also recorded the appointment of Mr. Sudarshan Patodia as Group CFO. The company said operations commenced at a 70-bed hospital in Nellore and a 50-bed hospital in Guntur, and that the Government of Andhra Pradesh had allotted two acres of land for a specialty paediatric hospital in Amaravati with an initial capacity of 150 beds, planned in phases.

What did Rainbow Children's Medicare's management say?

In the earnings call on 2 November 2026, management retained a high-teen top-line growth outlook for FY27 and the medium term without setting a fresh numerical target. Management kept an EBITDA-margin framework of approximately 25-26% for FY27 and the next two years, and said rapid commissioning could compress margin by approximately 0.5-1% for several quarters to a year.

On risks, management said ramp-up timing varies by city and some hospitals take 4-6 years to mature, and that a weak monsoon can reduce seasonal outpatient, inpatient and delivery volumes. Management also said the scope of future drug price caps and vaccination treatment remains uncertain despite low current exposure. The Group CEO said priorities include driving patient volumes, improving conversion, strengthening capacity utilisation and accelerating the operational maturity of new hospitals.

How did Rainbow Children's Medicare shares react?

The results were filed after market hours. From the price when the filing appeared, the stock fell 2.0% within five minutes and 2.7% within 15 minutes, before the move was 0.2% lower at 30 minutes. On the reaction day, measured from the previous close of ₹1224.0, the stock rose 2.2% to close, against a 0.9% median move for the Hospital industry.

By the next day's close the stock was up 1.7% from its pre-results close, while the industry median was up 1.5%, leaving the stock ahead by 0.2 percentage points. On the reaction day, the stock's gain was 1.4 percentage points above the industry median and the Nifty Smallcap 250 rose 1.4%. Past reaction-day moves were mostly negative, including 0.3% lower on 30 July 2026 and 8.3% higher on 27 October 2024.

How did other Hospital companies do?

Twelve other Hospital companies that have filed this quarter were compared with Rainbow Children's Medicare, with a median revenue growth of 20.6% as of 4 November 2026. Seven of them grew revenue more slowly than Rainbow Children's Medicare, while five grew faster. Of the ten peers for which profit was compared, seven reported higher profit.