Gem Aromatics Limited – Investor Presentation Summary

Key Operational Highlights

  • Revenue from operations recorded YoY growth in Q1FY27, reflecting improved underlying business activity
  • The quarter is seasonally softer, while the Clove business was impacted by floods in Madagascar, resulting in higher raw material prices and impacting sales
  • The situation has now normalised, supporting a more stable operating environment
  • Key drivers: Progress in customer engagement and product qualification for new product categories through Krystal Ingredients

Segment-wise Performance

Not Specified

Financial Highlights

Standalone Performance (Q1FY27):

  • Revenue: Rs 83.0 Cr (9% YoY growth)
  • Gross Profit: Rs 14.7 Cr
  • Gross Profit Margin: 17.7% (declined from 25.0% in Q1FY26)
  • EBITDA: Rs 8.5 Cr
  • EBITDA Margin: 10.3% (declined from 13.8% in Q1FY26)
  • PAT: Rs 7.3 Cr (11% YoY growth)
  • PAT Margin: 8.7%
  • EPS: Rs 1.4
  • Cash PAT: Rs 8.9 Cr (11% YoY growth)

Consolidated Performance (Q1FY27):

  • Revenue: Rs 98.9 Cr (13% YoY growth, -10.5% QoQ)
  • Gross Profit: Rs 16.5 Cr
  • Gross Profit Margin: 16.7% (declined from 29.5% in Q1FY26)
  • EBITDA: Rs 3.3 Cr
  • EBITDA Margin: 3.3% (declined from 17.0% in Q1FY26)
  • PAT: Rs (7.9) Cr (-199% YoY)
  • PAT Margin: -8.0%
  • EPS: Rs -1.6
  • Cash PAT: Rs 1.3 Cr (-87% YoY)

Drivers of financial performance: Gross margin and EBITDA margin were impacted primarily by product mix and higher raw material costs. The newly commissioned facility resulted in higher operating costs. Profitability was impacted by higher raw material and operating costs, along with Rs 9.1 Cr of higher depreciation following capitalization of ~Rs 265 Cr Dahej capex.

Key Risks: Product mix impact, higher raw material costs, higher operating costs from new facility, depreciation impact from capex

Geographical Revenue Split

Export Markets Served: 20 countries globally including Singapore, Australia, France, Indonesia, Ireland, Nepal, Netherlands, Thailand, Spain, Germany, Uganda, United Kingdom, Hong Kong, Bulgaria, Israel, Vietnam, Turkey and Switzerland

International Expansion: Company approved incorporation of Wholly Owned Subsidiary in Brazil in June 2026 to distribute essential oils, aromatic chemicals and specialty chemicals, strengthening presence across Brazil and broader Latin American market

Balance Sheet Snapshot

Consolidated Balance Sheet (as of Mar-26):

  • Share Capital: Rs 10.4 Cr
  • Reserves & Surplus: Rs 439.5 Cr
  • Shareholders' Funds: Rs 449.9 Cr
  • Long Term Borrowings: Rs 21.7 Cr
  • Short Term Borrowings: Rs 128.1 Cr
  • Property, Plant & Equipment and Intangible Assets: Rs 243.1 Cr
  • Inventories: Rs 233.7 Cr
  • Trade Receivables: Rs 76.7 Cr
  • Cash And Cash Equivalents: Rs 15.9 Cr

Financial Health Insights: Significant capitalization of assets (Rs 243.1 Cr in PPE) following Dahej expansion, maintained working capital through inventories and receivables

Capex & Cash Flow Health

Capital Expenditure: ~Rs 270 Cr total planned capex for Dahej facility, with ~Rs 265 Cr already capitalized

Consolidated Cash Flow (Q1FY27):

  • Cash Generated From Operations: Not specified for quarter
  • Net Cash From Operating Activities: Not specified for quarter
  • Net Cash From Investing Activities: Not specified for quarter
  • Net Cash From Financing Activities: Not specified for quarter

Annual Cash Flow Trends (FY26):

  • Cash Generated From Operations: Rs 46.4 Cr
  • Changes in Working Capital: Rs -5.5 Cr
  • Direct Taxes Paid: Rs -11.3 Cr
  • Net Cash From Operating Activities: Rs 29.6 Cr
  • Net Cash From Investing Activities: Rs -101.5 Cr
  • Net Cash From Financing Activities: Rs 77.6 Cr

Investment Rationale: Focus on capacity expansion and technology upgrades through Dahej greenfield project

Strategic & R&D Initiatives

Investments in Innovation: Continuous investment in R&D towards capex and technology upgrades with 13 qualified scientists

New Product Development:

  • Cooling Agents: Customer audits completed and initial orders secured for GEM Cool 03, GEM Cool 05 and GEM Cool 23. Revenue contribution expected from Q3FY27
  • Safranal: Revenue contribution expected towards end of Q2FY27 and more meaningfully from Q3FY27
  • Phenol Derivatives: Trial production expected by end of Q2FY27, followed by approvals and quality processes; commercial production targeted in Q3FY27, with revenue contribution expected from Q4FY27

Strategic Rationale: Focus on utilizing and monetizing expanded manufacturing platform at Dahej and scaling newer product categories through Krystal Ingredients. Multipurpose capabilities at Dahej provide flexibility to address evolving customer requirements and support development of specialty products

Industry Trends & Business Environment

Macro/Industry Trends: Seasonally softer quarter, clove business impacted by floods in Madagascar resulting in higher raw material prices

Impact on Company: Temporary disruption in clove segment affecting sales and margins, now normalized

Management Commentary & Growth Outlook

Strategic Outlook: "Our focus is increasingly shifting towards utilizing and monetising the expanded manufacturing platform at Dahej and scaling the newer product categories through Krystal Ingredients. We are seeing continued progress in customer engagement and product qualification. Our focus remains on converting these opportunities into recurring commercial business as they scale. Innovation and R&D remain central to our long-term strategy, with continued focus on process innovation, product customization and development of higher-value specialty molecules."

Growth Outlook: As capacity utilization improves and contribution from higher-value products increases, margins expected to gradually improve. Focus on progressively scaling Krystal Ingredients' Dahej facility, strengthening product capabilities and expanding presence across global markets

Risks and Opportunities: Higher raw material costs, product mix challenges, but opportunities from new product categories and international expansion

ESG Updates

Not Specified

Digital Transformation

Not Specified