RITES Q2 FY27 results: net profit down 11.0% to ₹97.06 crore, revenue up 1.5%

How did RITES perform in Q2 FY27?

RITES reported consolidated revenue of ₹556.83 crore for Q2 FY27, up ₹8.09 crore or 1.5% from Q2 FY26. Total income rose ₹3.77 crore or 0.7% to ₹582.81 crore. EBITDA declined ₹7.51 crore or 5.8% to ₹122.10 crore, and the margin fell 1.7 percentage points to 21.9%.

Profit before tax fell ₹12.10 crore or 8.5% to ₹129.99 crore, while tax expense declined ₹3.33 crore or 8.9% to ₹33.95 crore. Net profit was ₹97.06 crore, down ₹12.04 crore or 11.0% from ₹109.10 crore, and basic EPS declined ₹0.25 to ₹1.79. On a standalone basis, revenue was ₹521.82 crore and profit after tax was ₹94.35 crore.

Against Q1 FY27, revenue rose ₹24.63 crore or 4.6% to ₹556.83 crore and EBITDA increased ₹7.44 crore or 6.5% to ₹122.10 crore. The EBITDA margin rose 0.4 percentage points to 21.9%. Net profit fell ₹0.72 crore or 0.7% to ₹97.06 crore, while basic EPS fell ₹0.02 to ₹1.79.

What changed in RITES's costs and profit?

Total expenses rose ₹15.87 crore or 3.6% from Q2 FY26 to ₹452.82 crore. Other expenses increased ₹33.73 crore or 12.2% to ₹309.25 crore, employee cost rose ₹2.78 crore or 2.2% to ₹129.92 crore, finance costs increased ₹0.21 crore to ₹0.97 crore, and depreciation rose ₹0.06 crore to ₹17.12 crore. Cost of materials remained unchanged, with no exceptional item reported.

Other income fell ₹4.32 crore or 14.3% from ₹30.30 crore to ₹25.98 crore, while tax expense was lower by ₹3.33 crore or 8.9% at ₹33.95 crore. Management said the fall in profits was due to lower exports and a change in revenue mix. The investor presentation also stated that prior-period revenue and segmental revenue were restated after reversal of provisions was reclassified from other operating income to expenses.

Against Q1 FY27, total expenses increased ₹17.88 crore or 4.1%, led by a ₹5.79 crore decrease in employee cost being offset by higher depreciation and finance costs; other expenses were lower ₹0.85 crore. Other income fell ₹2.50 crore or 8.8% and tax expense rose ₹1.17 crore or 3.6% to ₹33.95 crore.

How did the first half of FY27 go?

For H1 FY27, consolidated revenue was ₹1,089.03 crore, up ₹50.55 crore or 4.9% from H1 FY26, while total income increased ₹52.73 crore or 4.8% to ₹1,143.49 crore. Management said the revenue growth was led by turnkey, leasing and energy businesses.

Profit before tax for the first half declined ₹5.58 crore or 2.1% to ₹255.73 crore. Net profit fell ₹5.15 crore or 2.6% to ₹194.84 crore and basic EPS declined ₹0.10 to ₹3.61. Management said profits decreased because of the change in revenue mix, while margins remained above the guided range.

What do the balance sheet and cash flow show?

At 30 September 2026, total assets were ₹5,870.04 crore, lower than ₹5,925.94 crore at 31 March 2026. Total equity declined from ₹2,794.03 crore to ₹2,774.96 crore, while cash fell from ₹557.01 crore to ₹476.84 crore. Inventories rose from ₹34.60 crore to ₹67.91 crore, trade receivables declined from ₹931.22 crore to ₹870.40 crore, and trade payables fell from ₹320.41 crore to ₹280.89 crore. There was no borrowing.

H1 FY27 operating cash flow was ₹201.05 crore, compared with an outflow of ₹81.86 crore in H1 FY26. Investing cash flow was an outflow of ₹69.80 crore against an inflow of ₹253.49 crore, and financing cash flow was an outflow of ₹211.48 crore against ₹211.36 crore. Capital expenditure was ₹37.53 crore, up from ₹34.25 crore.

How has RITES done over the last 8 quarters?

Revenue rose year on year in each of the last six quarters. Across the reported period, quarterly revenue bottomed at ₹489.74 crore in Q1 FY26 and peaked at ₹768.26 crore in Q4 FY26. Revenue then fell to ₹532.20 crore in Q1 FY27 before rising to ₹556.83 crore in Q2 FY27.

Net profit bottomed at ₹90.89 crore in Q1 FY26 and peaked at ₹141.33 crore in Q4 FY25. It was ₹97.06 crore in Q2 FY27, lower than ₹97.78 crore in the previous quarter. The EBITDA margin bottomed at 20.4% in Q3 FY25 and peaked at 30.2% in Q4 FY25; it was 21.9% in Q2 FY27.

Which businesses drove the quarter?

Domestic consultancy revenue declined 4.9% to ₹298.13 crore from ₹313.41 crore, while EBIT fell to ₹118.35 crore from ₹123.43 crore. Abroad consultancy revenue rose 8.8% to ₹15.41 crore, with EBIT of ₹1.08 crore compared with ₹2.27 crore. Export sale revenue fell 99.2% to ₹0.48 crore from ₹60.60 crore and recorded EBIT of a loss of ₹1.93 crore.

Domestic leasing revenue rose 14.5% to ₹49.05 crore, with EBIT of ₹19.37 crore compared with ₹12.78 crore. Turnkey construction projects reported revenue of ₹187.39 crore and EBIT of ₹3.04 crore. Power Generation revenue increased 34.1% to ₹6.37 crore, with EBIT of ₹2.48 crore, while the share of net profit or loss of joint ventures was ₹1.02 crore compared with ₹4.29 crore.

What else did the company announce?

On 4 November 2026, the board approved the unaudited standalone and consolidated results for the quarter and half year ended 30 September 2026. It declared a second interim dividend of ₹1.90 per share, representing 19% of paid-up share capital, with the record date on 11 November 2026 and payment by 3 December 2026.

The board also took note that the proposed joint venture with NICC Infrastructure Construction LLC and the related capital contribution were not proceeding. The company’s investor presentation stated that the order book was ₹9,388 crore after ₹446 crore of new orders, including extensions, were added during the quarter.

What did the auditors point out?

The auditor’s review report did not express an audit opinion and stated that nothing had come to its attention that caused it to believe the statement had not disclosed the information required under Regulation 33 of the SEBI Listing Obligations and Disclosure Requirements Regulations, 2015, or contained a material misstatement.

The auditor included an emphasis of matter for Indian Railway Stations Development Corporation Limited, which was under voluntary liquidation. RITES held a 24% share amounting to ₹60.39 crore in IRSDC’s net worth of ₹251.62 crore and had received an interim share-capital payment of ₹47.04 crore on 30 July 2026. The report stated that management did not perceive any impairment in the carrying value and that the conclusion was not modified. It also drew attention to the liquidation of RITES (Afrika) Proprietary Limited.

What did RITES's management say?

Management said Q2 FY27 revenue growth was modest and profits fell because exports declined and the revenue mix changed. It said the first half’s revenue growth was led by turnkey, leasing and energy, while the order book stood at ₹9,388 crore after ₹446 crore of quarterly wins. Management also stated that H1 FY27 margins remained above the guided range.

Management said export revenue had started picking up in Q3 with the first rake of coaches supplied to Bangladesh through October and expected export profits from Q3 FY27. It said export revenue should gain momentum in H2 FY27 through supplies to Bangladesh Railways and ICVL Mozambique, with profits expected from exports as Bangladesh supplies continue and Mozambique supplies begin.

Management identified export execution and timing as a risk because export revenue was effectively nil in Q2 FY27 and down 97.6% in H1 FY27, leaving the expected recovery dependent on deliveries to Bangladesh and Mozambique. It also noted that the NHIDCL and MECON MoUs were described qualitatively without a disclosed contract value or timeline. The presentation did not disclose a quantified capital expenditure plan.

How did other Civil Construction companies do?

Among 21 other Civil Construction companies that filed for the quarter, the median revenue growth was 9.4%. Fourteen peers grew revenue faster than RITES, while seven grew slower than the company’s 1.5% growth. Of the 22 peers for which profit was compared, 17 reported higher profit.