Redington Limited reported its highest-ever quarterly revenue and profit for Q1FY27, with consolidated net profit after tax (PAT) surging to ₹486 crore, a 77% increase year-on-year. Consolidated revenue from operations reached ₹34,966 crore, up 34% from the previous year. This performance underscores the company's expanding market share and effective cost management, with PAT growing more than twice as fast as revenue. The strong results were driven by robust growth across its Singapore, India & South Asia (SISA) segment, particularly in India where revenue grew 63%, alongside improved operational efficiency that expanded the EBITDA margin to 2.03% from 1.54%. For shareholders, the earnings per share (EPS) rose to ₹6.22 from ₹3.52 in Q1FY26. Excluding Arena, revenue grew 41% year-on-year to ₹33,794 crore with a profit of ₹517 crore, marking a best-ever quarter.

The Board of Directors approved the unaudited standalone and consolidated financial results on July 29, 2026, pursuant to Regulation 33 and Regulation 52(4) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. The results were reviewed by the Audit Committee on July 28, 2026, and subjected to a limited review by Deloitte Haskins & Sells Chartered Accountants LLP, the statutory auditors. Management highlighted that working capital days improved significantly, dropping by five days year-on-year to 32 days globally, reflecting enhanced cash conversion efficiency. No unpublished price-sensitive information was shared during the earnings conference call held on July 30, 2026.

Financial Performance Overview

On a standalone basis, Redington reported a net profit of ₹321.01 crore for the quarter ended June 30, 2026, up from ₹200.21 crore in the corresponding period last year. Revenue from operations on a standalone basis stood at ₹20,753.20 crore. The company achieved a return on capital employed (ROCE) of 22.2% and a return on equity (ROE) of 18.8%, indicating strong capital efficiency. The debt-to-equity ratio remained conservative at 0.39 times. Finance costs increased sequentially by 74% to ₹89 crore due to higher interest rates and increased inventory days industry-wide. A tax refund of ₹147 crore from past years contributed to other income.

Segment-wise Analysis

The growth was broad-based across both reportable segments. The SISA segment contributed ₹21,126.29 crore to revenue, up 63% from ₹12,994.89 crore in Q1FY26. Its segment result improved to ₹484.73 crore from ₹318.48 crore. Within SISA, India Distribution saw revenue grow by 63%, with EBITDA rising 54% and PAT increasing 60%. The Rest of the World (ROW) segment saw revenue rise to ₹13,810.08 crore from ₹12,970.60 crore, with its segment result jumping significantly to ₹215.48 crore from ₹77.47 crore. Excluding Arena, ROW revenue grew by 16%, while EBITDA grew by 64% and PAT by 81%. Middle East and Africa grew 15%, driven by GCC and Levant regions at 95% and Africa at 39%, despite flat performance in UAE and Saudi Arabia due to geopolitical tensions.

Business Segment Momentum

Redington recorded strong momentum across its technology portfolio during the quarter. The Software Solutions Group (SSG) grew 52% year-on-year, supported by increased adoption of cloud, cybersecurity, software-led engagements, AI-enabled solutions and subscription-based models. Cloud business specifically grew 67% year-on-year. The Endpoint Solutions Group (ESG) grew 35% year-on-year, supported by higher PC realisations amid ongoing industry-wide memory supply constraints and sustained market demand. AI PC penetration into the commercial segment continued to grow with 36% of the revenues in India from AI PCs. The Mobility Solutions Group (MSG) grew 21% year-on-year, led by demand for premium smartphones and the continued expansion of retail-led distribution models. The Technology Solutions Group (TSG) grew 50% year-on-year, driven by the execution of large enterprise and data-centre deals, including nearly ₹1,000 crore in large deals, mostly in India.

What the Numbers Show

A key analytical observation is the disproportionate rise in consolidated net profit relative to revenue growth, driven by margin expansion and improved working capital management. The EBITDA margin expansion to 2.03% reflects improved operating leverage. The absence of exceptional items in Q1FY27, compared to a charge in the previous quarter, and a decline in finance costs as a percentage of revenue likely contributed to this margin improvement. Additionally, the reduction in working capital days by five days year-on-year to 32 days indicates stronger cash flow dynamics, despite free cash flow remaining negative due to significant changes in working capital. Management noted that PC prices have increased between 25% and 50% over the last few quarters, driving ASP increases while unit volumes remained flat to single-digit growth.

Operational Updates

The company continues to expand its global presence, having incorporated PT Redington Technology Indonesia and Redington (Thailand) Limited during the quarter. Post-quarter, it added Aladeem Al Ahmar for Computer and Mobile phone Trading and Services LLC in Iraq. ProConnect, the logistics arm, achieved all-time high quarterly revenues with a 38% YoY growth, maintaining an EBITDA margin of 9%. Management noted that while operations are adapting to geo-political situations in the Middle East, no material adverse effects on the financial position are foreseen. Ind AS 29 was applied for subsidiaries using Turkish Lira, with no significant impact on consolidated results. Arena reported a loss of ₹64 crore, with the Redington portion being ₹31 crore, due to lower revenue after exiting mobility business and divestment of Paynet. Redington earned Microsoft’s Frontier Partner designation, recognizing its readiness for the AI era.

FMR LLC and its direct and indirect subsidiaries, along with FIL Limited and its subsidiaries, have increased their aggregate stake in Redington Limited to 8.46%. The acquirers purchased 16,359,425 equity shares carrying voting rights through open market transactions conducted between May 7, 2025, and July 30, 2026. This acquisition represents a 2.09% increase in the total voting capital of the company, bringing the post-acquisition holding to 66,141,218 shares.

The disclosure was made in compliance with Regulation 29(2) of the SEBI (Substantial Acquisition of Shares and Takeovers) Regulations, 2011. The filing indicates that the acquirer does not belong to the promoter or promoter group of Redington Limited. The total equity share capital of Redington Limited remained unchanged at 781,774,431 shares before and after the acquisition. No warrants, convertible securities, or other instruments entitling the acquirer to receive shares were involved in the transaction, nor were any shares encumbered with pledges or liens.

Breakdown of Acquisition

The acquisition was executed across multiple funds managed by FMR LLC and FIL Limited. The following table details the holdings after the acquisition:

What the Numbers Show

The largest single fund holding is the Fidelity Low-Priced Stock Fund - Cash Sub, which holds 22,100,220 shares, representing 2.83% of the company's voting capital. The Fidelity International Small Cap Fund holds the second-largest position with 16,000,000 shares (2.05%). Together, these two funds account for nearly half of the total stake held by the acquirer group. The acquisition was signed by Alina Yu, Regulatory Reporting Manager, duly authorized under Powers of Attorney by and on behalf of FMR LLC and FIL Limited, from Dalian, People's Republic of China.