Redington Q1 FY27 Results Analysis: PAT Surges 77%, India Cycle Accelerates

Redington Ltd's Q1 FY27 numbers came in strong, with revenue of Rs. 34,922.47 Cr (+34.57% YoY) and PAT growth of +76.55% YoY. Here's a quick read of what worked, what to watch, and what management said.

Quarter Snapshot

Redington delivered strong Q1 results with 34.6% revenue growth and 76.6% PAT growth, driven by the India IT hardware refresh cycle. The ROW segment showed a sharp margin recovery, but gross margin faced pressure from forex headwinds and debt increased to fund working capital. The company did not provide specific forward guidance, leaving the sustainability of the India growth cycle and ROW margin trajectory as key swing factors.

Key Investment Insights

Key Positives

• Revenue grew 34.6% YoY to Rs.34,922 cr, the fastest pace in available periods.
• PAT attributable to owners grew 76.6% YoY to Rs.485.98 cr.
• EBITDA margin improved 49 bps YoY to 2.03%.
• ROW segment margin doubled from 0.60% to 1.56% YoY.
• Debtor turnover improved from 5.98x to 7.13x, indicating faster collections.
• Standalone India business grew 62.7% YoY.

Risk Factors

• Gross margin compressed 17 bps YoY due to forex headwind from USD/INR depreciation.
• Debt/Equity increased from 0.29x to 0.56x, reflecting higher borrowings for working capital.
• Current ratio declined from 1.43x to 1.33x, indicating working-capital stretch.
• ROW revenue grew only 6.5% YoY, impacted by global PC market decline.