Sangam Q2 FY27 results: net profit up 130.9% to ₹53.40 crore, revenue up 33.0%

How did Sangam perform in Q2 FY27?

Sangam reported consolidated revenue from operations of ₹1,045 crore for Q2 FY27, up 33.0% from ₹786.18 crore in Q2 FY26 and 21.5% from ₹860.35 crore in Q1 FY27. Total income was ₹1,050.70 crore, compared with ₹784.78 crore a year earlier and ₹867.28 crore in the previous quarter.

Consolidated EBITDA was ₹121.22 crore in Q2 FY27, against ₹76.94 crore in Q2 FY26 and ₹105.37 crore in Q1 FY27. The EBITDA margin was 11.6%, compared with 9.8% a year earlier and 12.2% in the previous quarter. Profit before tax was ₹68.19 crore, and net profit was ₹53.40 crore, with basic EPS of ₹10.63.

The standalone results for Q2 FY27 showed revenue of ₹1,030.2 crore and profit of ₹51.45 crore, compared with standalone profit before tax of ₹23.78 crore in the year-ago quarter.

What changed in Sangam's costs and profit?

Total expenses rose to ₹980.85 crore in Q2 FY27 from ₹749.04 crore in Q2 FY26. Cost of materials increased by ₹113.44 crore to ₹552.76 crore, employee cost by ₹9.48 crore to ₹83.06 crore, finance costs by ₹1.15 crore to ₹30.49 crore, depreciation by ₹15.80 crore to ₹26.26 crore and other expenses by ₹64.30 crore to ₹229.33 crore.

Other income was ₹5.38 crore, compared with negative ₹1.40 crore in Q2 FY26, a difference of ₹6.78 crore. An exceptional charge of ₹1.66 crore was recorded in both quarters. Tax expense was ₹14.79 crore, higher by ₹3.84 crore than the ₹10.95 crore reported a year earlier.

Against Q1 FY27, cost of materials was higher by ₹56.53 crore, employee cost by ₹2.05 crore, finance costs by ₹0.66 crore, depreciation by ₹0.60 crore and other expenses by ₹44.67 crore. Other income was lower by ₹1.55 crore, while tax was higher by ₹0.66 crore.

How did the first half of FY27 go?

For the first half of FY27, consolidated revenue was ₹1,905.67 crore, up 20.9% from ₹1,575.95 crore in H1 FY26, while total income was ₹1,917.98 crore against ₹1,587.29 crore. Profit before tax increased to ₹123.34 crore from ₹36.61 crore.

H1 FY27 net profit was ₹94.42 crore, compared with ₹25.26 crore in H1 FY26, and basic EPS was ₹18.79 against ₹5.03. Management said H1 FY27 PAT had already exceeded FY26 full-year PAT of ₹83 Cr.

What do the balance sheet and cash flow show?

At 30 September 2026, total assets were ₹3,671.17 crore, compared with ₹3,314.82 crore at 31 March 2026. Total equity was ₹1,190.96 crore against ₹1,076.27 crore, while borrowings rose to ₹1,499.51 crore from ₹1,275.94 crore. Cash was ₹12.80 crore, compared with ₹50.89 crore.

Inventories increased to ₹652.26 crore from ₹586.57 crore at 31 March 2026, and trade receivables rose to ₹830.19 crore from ₹637.12 crore. Trade payables were ₹670.83 crore, compared with ₹698.03 crore. The investor presentation stated that total equity at September 2026 included ₹25 Cr received against share warrants.

Net cash from operating activities in H1 FY27 was negative ₹40.84 crore, against positive ₹9.25 crore in H1 FY26. Investing cash flow was negative ₹170.77 crore, compared with negative ₹114.45 crore, while financing cash flow was positive ₹177.96 crore against ₹84.68 crore. Capital expenditure was ₹230.45 crore, compared with ₹105.19 crore.

How has Sangam done over the last 8 quarters?

Revenue reached its highest level of the eight-quarter series in Q2 FY27 at ₹1,045.32 crore, while the lowest was ₹734.30 crore in Q4 FY25. Revenue rose year on year in each of the last eight quarters, according to the trend data.

Net profit increased to ₹53.40 crore in Q2 FY27 from ₹2.13 crore in Q1 FY26, the lowest point in the series. Profit had risen year on year in each of the last five quarters.

The EBITDA margin peaked at 12.2% in Q1 FY27 and was 11.6% in Q2 FY27, compared with its low of 7.3% in Q1 FY26. The current direction was lower for margin, while revenue and profit were higher than the previous quarter.

What else did the company announce?

The board approved the unaudited standalone and consolidated financial results for the quarter and half year ended 30 September 2026. The statutory auditors issued limited review reports for the standalone results, and the filing stated that nothing had come to their attention indicating that the results were not disclosed as required or contained any material misstatement.

The same-day investor presentation covered a growth capital expenditure programme of about ₹1,500 Cr by March 2029. The presentation also stated that India Ratings upgraded the company to IND A / Stable in October 2026, covering ₹2,770 Cr of bank facilities. No dividend or appointment was stated in the provided same-day filings.

What did Sangam's management say?

Management said the company would invest about ₹1,500 Cr by March 2029 to add capacity, modernise plants and lower cost through renewable power and recycled fibre. It also set out completion targets for a 5 MW hybrid power project in Q3 FY27, a 20 MW project in Q1 FY28, a cotton yarn project in Q2 FY28 and a PV yarn project in Q4 FY28.

Management identified working-capital strain and lower garments utilisation as risks. It said H1 FY27 operating cash flow was negative ₹41 Cr, working capital absorbed ₹263 Cr, receivable days rose to 77 from 67 and garments capacity utilisation fell to 37% in Q2 FY27 from 61% in Q4 FY26.

Management said depreciation rose 160.0% YoY in Q2 FY27 to ₹26 Cr as new assets came online, while EBITDA also included other income of ₹5 Cr in Q2 FY27 and ₹12 Cr in H1 FY27. The presentation also said the domestic market contributed around 70% of revenue and that the company had 3,06,864 spindles and 136 million metres of fabric capacity.

How did Sangam shares react?

The stock was down 0.3% five minutes after the filing appeared, down 2.0% after 15 minutes and down 2.8% after 30 minutes. It closed 1.9% lower on the reaction day from the previous close, compared with a 1.2% median rise for other stocks in the Other Textile Products industry.

By the next day's close, the stock was down 4.9% from its pre-results close. The industry median was up 1.7% over the same period, leaving Sangam 6.5 percentage points below the sector. The Nifty Microcap 250 was up 2.2% on the reaction day.

Earlier reaction-day moves were negative on six of the eight listed dates, including falls of 3.6% on 18 July 2026, 4.0% on 21 January 2026, 8.2% on 10 November 2025 and 5.6% on 1 August 2025. The shares had risen 6.8% on 22 April 2026 and 3.0% on 12 February 2025.

How did other Other Textile Products companies do?

Among 77 Other Textile Products companies compared for the quarter, the median revenue growth was 24.1%. Sangam’s revenue growth was above the peer median, with 24 peers growing faster than the company and 52 growing slower than the company. Of 79 peers for which profit was compared, 57 reported higher profit.