Financial Performance Overview
Chemfab Alkalis Limited reported challenging FY26 results with revenue declining 10.4% to ₹288.56 crore (₹28,856.60 lakhs) from ₹322.09 crore in FY25. Net profit fell sharply by 51% to ₹7.51 crore (₹750.59 lakhs) from ₹15.22 crore previously. Earnings per share dropped to ₹5.22 (basic and diluted) from ₹10.65 in FY25. The performance was impacted by soft global caustic soda prices with ECU realization moderating from ₹42,386/MT to ₹36,700/MT, and a significant pause in Jal Jeevan Mission funding between October 2024-March 2026 that affected tendering activity.
Segment Performance and Capex
Chlor Alkali Business: Revenue reached ₹195.69 crore (68% of total) with EBIT loss narrowing to ₹1.17 crore from ₹5.20 crore. The segment completed ₹56 crore technology modernization including new-generation electrolyser plant replacing the 1994 installation.
OPVC Pipes Business: Revenue declined to ₹93.47 crore (32% of total) but remained profitable with EBIT of ₹19.43 crore. The company expanded capacity to 20,000 TPA with Lines 5 and 6 commissioned during FY26, investing ₹56 crore. Line 7 is scheduled for Q2FY27 with ₹30 crore commitment to reach 23,000 TPA total capacity.
Capital Structure and Borrowings
Total borrowings increased to ₹12,291.62 lakhs with non-current borrowings at ₹8,143.00 lakhs (including ₹7,043.00 lakhs secured term loans) and current borrowings at ₹4,148.62 lakhs. The company disclosed a covenant breach in its Axis Bank term loan (current ratio requirement ≥1.20 vs actual 0.73), though the lender waived this breach post-reporting date. Debt-equity ratio increased to 0.30 from 0.21.
Corporate Actions and Governance
The Board recommended a final dividend of ₹1.25 per share (1250%) absorbing ₹179.67 lakhs. M/s M S K C & Associates were appointed as statutory auditors for 5 years from the 17th AGM. The company paid fines of ₹4,20,080 each to NSE and BSE for non-compliance with SEBI LODR Regulation 17(1)(b) regarding a 12-day delay in obtaining shareholder approval for director appointment. A corrigendum was issued to correct AGM agenda item numbering from 4-5 to 5-6 for special business items.
Subsidiaries and Related Parties
Chemfab Hiitech Piping Limited was incorporated as a wholly-owned subsidiary on 28th October 2025, while Chemfab Alkalis Karaikal Limited was renamed to Chemfab Karaikal Limited. Significant related party transactions included purchase of property, plant & equipment from Chemfab Karaikal (₹278.91 lakhs) and inter-corporate deposit from Team Hiitec Eqpt (₹110.00 lakhs).
Outlook and Forward Statements
Management expects FY27 to be materially stronger with resumed Jal Jeevan Mission funding (₹67,600 crore allocation for 2.0) expected to revive demand from Q2FY27. The hybrid renewable power project is ready for supply in Q1FY27, targeting 55% energy from renewables. The company maintains its position as the largest OPVC capacity in India with products approved in 15 states for government water projects.