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Rentomojo delivered strong operating growth in Q2 FY27, with revenue increasing 52.8% year on year and normalised profit rising 52.2%. However, reported net profit declined sharply because of a significant difference in deferred tax treatment between the two periods.

The Bengaluru based furniture and appliance rental platform reported consolidated revenue from operations of ₹142.1 crore, compared with approximately ₹93 crore in the corresponding quarter. Revenue also increased 12.5% quarter on quarter, indicating continued business expansion.

Normalised EBITDA increased 52.7% year on year to ₹58.8 crore. Sequentially, normalised EBITDA grew 12.6%, broadly matching revenue growth and indicating relatively stable underlying operating profitability.

Normalised profit after tax reached ₹24 crore, representing growth of 52.2% year on year and 9.4% quarter on quarter. These figures exclude exceptional items and provide a clearer view of the company’s adjusted earnings performance.

Reported EBITDA increased 53.7% year on year to ₹59.2 crore. Reported profit before tax reached ₹24.4 crore, representing growth of 54.8% compared with the corresponding quarter.

However, reported profit after tax declined 62.6% year on year to ₹18.2 crore. The comparison was affected by a deferred tax credit of ₹32.84 crore in Q2 FY26, against a deferred tax expense of ₹6.21 crore in Q2 FY27.

This tax difference explains why reported profit declined despite strong operating growth. Investors should distinguish between normalised earnings and statutory profitability rather than treating the two measures as interchangeable.

Sequential comparisons also require context because Q1 FY27 included an exceptional fire related loss of approximately ₹11.37 crore. This affected the quarter on quarter growth reported for EBITDA, EBIT, profit before tax and net profit.

One of the strongest operating indicators was the 45% year on year increase in gross items ordered by customers. Orders reached 381,347 during Q2 FY27, reflecting expanding demand for furniture and appliance subscriptions.

Live items increased 44% year on year to approximately 10.5 lakh, while live subscribers grew 42.5% to around 3.24 lakh. The simultaneous increase in customers and deployed assets indicates broad based expansion.

Average items per user remained stable at 2.8. This suggests that growth was primarily supported by a larger subscriber base rather than a substantial increase in the number of products rented by each customer.

Average occupancy improved by 61 basis points to approximately 85.9%. Higher utilisation is important because Rentomojo generates recurring revenue by deploying its furniture and appliance inventory across paying subscribers.

Average revenue per item increased 4.6% year on year. Together with higher occupancy and subscriber growth, this contributed to revenue expansion beyond the increase in customer orders alone.

Rentomojo continued expanding its physical retail network alongside its digital platform. The company operated 96 Experience Stores across 14 cities at the end of September, compared with 67 stores a year earlier.

These stores allow customers to examine furniture and appliances before subscribing. The company uses local demand information to determine new locations, helping connect its physical network with digital customer acquisition.

For H1 FY27, revenue from operations reached ₹268.4 crore, representing 52% year on year growth. Normalised EBITDA increased 51.5% to ₹111.1 crore, while normalised PAT grew 61% to ₹45.9 crore.

Operating cash flow was another important highlight. Rentomojo generated approximately ₹110 crore from operating activities during the first half, equivalent to 109.8% of reported EBITDA for the period.

However, capital expenditure increased 140.6% year on year to approximately ₹192.3 crore. This investment reflects the capital intensive nature of expanding rental inventory and the company’s physical operating network.

Following its September stock market listing, Rentomojo used ₹70 crore of IPO proceeds to repay or prepay debt. Its debt to equity ratio improved to 0.50 times from 0.63 times at the end of FY26.

Net debt declined to approximately ₹130.6 crore from ₹149.3 crore, while net worth increased to ₹466.2 crore. The stronger balance sheet may provide additional flexibility for expansion, although funding costs and capital requirements remain important.

The company’s asset lifecycle model is another distinctive feature. Its FY2017 asset cohort has generated cumulative revenue equivalent to 5.32 times its original value, demonstrating the potential benefits of refurbishment and repeated deployment.

Rentomojo’s Q2 FY27 results highlight strong subscriber growth, improving asset utilisation and healthy operating cash generation. Future performance will depend on sustaining rental demand, managing capital expenditure and converting operating growth into recurring statutory profits.