Financial Performance Highlights (Q1 FY27)

Revenue:

  • Net revenue from operations: ₹403 crores
  • Year-on-year growth: 20% (from ₹336 crores in Q1 FY26)
  • Quarter-on-quarter growth: 22% (from ₹330 crores in Q4 FY26)

Volumes:

  • Volume growth: 9% YoY compared to Q1 FY26
  • Sequential decline: 3% QoQ compared to Q4 FY26
  • Volume index: 145 (base: Q1 FY20 = 100)

Profitability:

  • EBITDA: ₹45 crores (48% YoY growth from ₹31 crores in Q1 FY26)
  • EBITDA margin: 11.2% (expanded 210 bps YoY and 480 bps QoQ)
  • Profit Before Tax (PBT): ₹37 crores (60% YoY growth from ₹23 crores)
  • Profit After Tax (PAT): ₹28 crores (61% YoY growth from ₹17 crores)

Operational Performance

Volume Breakdown:

  • Domestic volumes: 67% of total (double-digit growth)
  • Export volumes: 33% of total (single-digit growth)

Market Segments:

  • Tyre industry: Continued healthy domestic demand supported by strong replacement demand and OEM offtake
  • Non-tyre segment: Experienced temporary demand contraction due to increased input costs and labor shortages related to cooking gas shortages

Geopolitical Impact:

  • Middle East war crisis caused logistical challenges and increased freight rates
  • Utility constraints due to gas price increases and availability issues
  • Temporary supply-side constraints resulted in postponement of certain order commitments

Strategic Updates

New TDQ Plant (Dahej):

  • Trial production progressing well with initiation of customer samples
  • Approvals expected to take 6-8 months
  • Revenue contribution expected to begin in Q4 FY27, with more significant volumes in Q1 FY28

Capacity Expansion:

  • New ₹130 crore investment in Dahej progressing well despite geopolitical challenges
  • Teams maintaining project timeline

Anti-Dumping Duties:

  • Central Government approved imposition of anti-dumping duty on Sulphonamides (CBS and NS) on 20th June 2026
  • DGTR issued positive final recommendation for Pilflex 13 in June 2026
  • Government approval for Pilflex 13 duty pending (expected decision by end of September 2026)
  • Approximately 25-30% of top line would be covered under ADD if Pilflex 13 is approved

Guidance and Outlook

FY27 Expectations:

  • Revenue guidance: ₹1,400-1,600 crores
  • EBITDA margin: Around 10%
  • Volume growth: Approximately 10% for full year

Market Outlook:

  • Underlying industry fundamentals remain strong
  • Healthy replacement demand and continued OEM momentum
  • Some near-term moderation expected due to seasonal factors and monsoon progress
  • Long-term growth trajectory remains positive

Q&A Session Key Points

Cost Structure:

  • Conversion costs increased due to Middle East crisis impacting freight rates
  • Higher CSR expenditures in Q1 (typically evens out through year)
  • Utility cost inflation due to gas price increases
  • One-off maintenance costs incurred
  • Employee cost increases due to annual increments and retirals

Volume Recovery:

  • Company working to normalize supplies and execute pending orders
  • Confident of recovering deferred volumes in coming quarters
  • Temporary non-tyre segment weakness expected to be transitional

Competitive Landscape:

  • Chinese competitor China Sunshine adding accelerator capacity
  • Company believes anti-dumping duties and international customer relationships provide competitive positioning
  • No significant impact from INR depreciation against yuan as Chinese players adjust prices downward

Specialty Chemicals:

  • Current specialty segment at approximately 15% of top line
  • Expected to grow by additional 5-10% with new expansions
  • Export target: Directionally moving toward 40-45% of revenue (currently 33%)

Additional Information

  • Stock change of ₹45 crores related to manufacturing improvement
  • Promoter holding pledged at approximately 24% (management declined to comment as promoter decision)
  • R&D teams working closely with customers on new products with expected traction during the year