Kwality Wall’s Q2 FY27: Revenue Up 44%, Net Loss Narrows to ₹17 Crore

Kwality Wall’s (India) Limited reported a net loss of ₹17.2 crore for the second quarter of fiscal year 2027, marking a significant improvement compared to the ₹100.2 crore loss recorded in the same period last year. Despite the loss, the company’s revenue from operations surged by 44 percent, reaching ₹463.6 crore, as product sales stood at ₹453 crore for the quarter.

The company highlighted organic sales growth of 42.2 percent, fueled by a 31.8 percent rise in volume and a 7.9 percent increase in pricing. This growth reflects a positive response to Kwality Wall’s product offerings, particularly in its impulse and in-home portfolios. However, on a sequential basis, revenue from operations dropped sharply by 47.3 percent from ₹879.8 crore recorded in the first quarter of FY27. The previous quarter had also seen Kwality Wall’s deliver a net profit of ₹50.7 crore.

Even with the net loss, the company achieved a positive earnings before interest, tax, depreciation, and amortization (Ebitda) of ₹27.2 crore before exceptional items, resulting in an Ebitda margin of 6 percent. This suggests operational improvements despite the quarterly loss.

Kwality Wall’s reported a year-on-year improvement in gross margin by 282 basis points, reaching 46.4 percent. The company attributed this to a better product mix, enhanced productivity efforts, and disciplined pricing strategies. These gains came despite rising input costs linked to the shift in its in-home product range towards richer, dairy-based recipes.

The quarter marked the company’s strongest organic sales growth in the past 16 quarters, with volume increases leading the way. The impulse product category experienced high double-digit volume growth, while the revamped in-home segment also showed robust double-digit expansion following the introduction of a creamier, dairy-focused recipe. Growth was widespread across multiple sales channels, including General Trade, Quick Commerce, and Modern Trade. Quick Commerce recorded particularly high double-digit gains, supported by solid growth in Modern Trade as well.

For the six months ending September 2026, Kwality Wall’s posted revenue from operations of ₹1,341.9 crore, up from the previous year’s comparable period. The company reported a net profit of ₹33.5 crore for the half-year, a turnaround from a net loss of ₹62.6 crore in the prior year. Ebitda for the six-month period stood at ₹132.1 crore, with a margin of 10 percent.

Kwality Wall’s financial position also improved, with cash and cash equivalents rising substantially to ₹214.4 crore as of September 30, 2026, compared with ₹14 crore at the end of March 2026. The increase in liquidity provides the company with greater flexibility amid a challenging market environment.

The dairy sector has faced rising input costs recently, largely driven by higher milk procurement prices and increased expenses for cattle feed and fodder. These cost pressures have been exacerbated by uneven rainfall patterns, which have negatively impacted milk production in certain regions.

Industry analysts expect milk prices to remain elevated through the October to February flush season, a period that typically sees higher milk supplies. Cattle feed costs have risen by an estimated 15 to 20 percent year-over-year, while cow milk procurement prices increased by approximately 30 percent, according to market estimates.

In response to these cost pressures, the Karnataka government raised the price of Nandini milk by ₹8 per litre starting November 1, citing the need to address rising production costs and improve returns for dairy farmers.

Kwality Wall’s latest quarterly results reflect the company’s efforts to navigate this challenging cost environment while continuing to grow its sales and improve operational efficiency. The company’s focus on product innovation and channel expansion appears to be contributing to stronger volume growth and a better product mix, key factors in its improving financial metrics.