Nelco Q1 profit up 30% to ₹2.34 cr, exceptional gain lifts bottom line
Net profit rose to ₹2.34 crore from ₹1.80 crore a year ago, but a ₹1.06 crore exceptional gain from retirement provision reversal contributed nearly half of the earnings.
— 2 earlier stories on Nelco Ltd. →What's new
- Nelco Q1 net profit ₹2.34 cr, up 30% from ₹1.80 cr YoY.
- Revenue grew 7% to ₹80.03 cr; exceptional gain of ₹1.06 cr boosted profit.
- Board reappointed P.D. Dani & Associates as cost auditors for FY27.
Why this matters
The 30% profit growth looks healthy but is largely driven by a one-time exceptional gain. Excluding that, net profit would have been roughly flat. With a P/E of 593 and ROE of just 2.6%, Nelco remains a high-multiple, low-return stock where quarterly beats need to be sustained without exceptional items.
What we're watching
- Will revenue growth accelerate beyond 7% in coming quarters?
- Whether margins can improve without exceptional gains.
- Any update on order book or new contracts in the IT hardware space.
The full read
Nelco turned in a 30% year-on-year profit growth to ₹2.34 crore for Q1 FY27, on revenue of ₹80.03 crore (up 7%). But nearly half the profit came from a ₹1.06 crore exceptional gain — a reversal of retirement benefit provisions following new labour codes. Strip that out, and earnings are barely ahead of last year. The board also reappointed P.D. Dani & Associates as cost auditors, a routine governance step. For a stock trading at 593x trailing earnings with a 2.6% ROE, the market is betting on a future that these numbers don't yet deliver. It's a steady quarter, not a turning point.
Questions answered
- What was the exceptional gain in Nelco's Q1 results?
- Nelco recorded an exceptional gain of ₹1.06 crore from the reversal of a provision for retirement benefits linked to new labour codes. This added about 45% to the reported net profit.
- How much did Nelco's revenue grow in Q1?
- Revenue from operations grew 7% year-on-year to ₹80.03 crore, while net profit rose 30% to ₹2.34 crore.
- Is this a routine quarterly filing?
- Yes, the results are a standard compliance filing with no new guidance or major strategic moves. The reappointment of cost auditors is also routine.
- Why is the stock trading at such a high P/E?
- With a trailing P/E of 593 and ROE of 2.6%, the market likely prices in future growth or a turnaround, but current earnings don't justify the multiple.
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All notes on NELCO →- 16 Jul 2026 · 5:54 PM IST Nelco Q1 profit up 30% to ₹2.34 cr, exceptional gain lifts bottom line
- 12d ago Nelco Q1 profit up 30% to ₹2.34 cr, but exceptional gain aids
- 12d ago Nelco Q1 profit rises 30% on exceptional gain