Financial Performance Highlights

Full Year FY26 (Year-ending March 2026):

  • Total Income: ₹393.1 crores, representing a growth of 44.62% year-on-year.
  • Profit After Tax (PAT): ₹28.49 crores, a growth of 360.9% over FY25.
  • EBITDA: ₹66.38 crores, a 159% increase over FY25.
  • EBITDA Margin: 16.89%, an improvement of 747 basis points year-on-year.
  • Caustic Soda Volume: 84,690 metric tons, up 29.7% over FY25.

Q4 FY26 (Quarter-ending March 2026):

  • Total Income: ₹97.75 crores, up 22.3% year-on-year.
  • PAT: ₹4.39 crores, up 68.64% over Q4 FY25.
  • EBITDA: ₹13.72 crores.
  • EBITDA Margin: 14.03%, up 247 basis points quarter-on-quarter.
  • Caustic Soda Volume: 20,935 metric tons, up 8.72% year-on-year.

Balance Sheet Position (as of 31 March 2026)

  • Shareholders' Funds: ₹242.52 crores (up from ₹181.67 crores a year ago).
  • Total Assets: ₹478.7 crores.
  • Long-term Debt: ₹96.37 crores.
  • Short-term Borrowings: ₹65.58 crores.
  • Debt-to-Equity Ratio: Approximately 0.67x.
  • Capital Work-in-Progress: ₹43.85 crores.

Operational and Strategic Updates

Renewable Energy Initiatives:

  • Power and fuel costs accounted for 61% of production cost structure in FY25, reduced to approximately 42% in FY26 through renewable integration.
  • A 21 MW solar plant in Rajasthan is expected to be commissioned by mid-June 2026.
  • Upon commissioning, total captive renewable capacity will be 37 MW plus 10 MW from a group captive project, increasing renewable energy share to 40-45% of total power requirements.
  • This is expected to further reduce energy cost per ton and improve EBITDA margins sustainably.

Capacity Expansion & Capex:

  • Total capex outlay of ₹315 crores from FY24 to FY27-28 is on track.
  • First phase of ₹150 crores covering 90 TPD caustic soda expansion and 16 MW solar plant completed.
  • Second phase includes 21 MW captive solar plant, CPW capacity expansion from 50 to 100 tons per day, and a further 100 TPD expansion of the caustic soda plant.
  • Post-expansion, total installed capacity will be 360 tons per day (after decommissioning an old 40-ton plant).
  • Projects are funded through internal accruals and debt.

Market & Demand Environment:

  • Growth was driven by strong demand from key end-user sectors: aluminum, paper, textiles, and pharmaceuticals.
  • The company serves the North Indian market, which provides a structural competitive advantage due to freight economics.
  • India has transformed from a net importer to a net exporter of caustic soda.
  • Management is optimistic about the demand environment for FY27, with improving realizations on a quarter-on-quarter basis.

Q&A Session Key Points

Energy Cost Accounting: A shortfall of 97 lakh units from a consortium project was accounted for as per the share purchase agreement. Full units are expected from June 2026 onwards.

Utilization & Growth: Current capacity utilization is around 80-85%. No new capacity is expected in North India for the next 2-2.5 years, supporting positive demand outlook.

Sulfuric Acid Project: Plans for sulfuric acid capacity have been deferred due to volatile global sulfur prices and geopolitical situations.

Pricing Trends: Caustic soda prices remain elevated (12-15% higher than pre-war levels) despite a correction from March peaks. No significant shift from export to domestic capacity is observed.

Margin Compression in Q4: The sequential decline from Q3's >20% EBITDA margin to Q4's 14.03% was attributed to higher grid electricity rates effective October 2025, a temporary shutdown of an electrolyzer for renovation, and slightly lower caustic soda prices.

Raw Material Inflation: Key raw material salt (11-12% of production cost) is under yearly contract with stable prices. Other purification chemicals saw price inflation of 20-30%, but with minimal overall cost impact.

Cost of Debt: The current average cost of debt is approximately 8%. An additional long-term debt of ₹90 crores is being raised for capex.

ESG & Commercial Benefits: The company's renewable energy investments provide tangible cost savings alongside ESG benefits, with customers increasingly seeking green credentials.

Industry Outlook: New large-scale capacity additions in India are focused on captive chlorine consumption for downstream products (like PVC) and exports, minimizing risks of domestic oversupply. Pricing is evaluated on an Electrochemical Unit (ECU) basis, where caustic soda and chlorine prices often offset each other.