Integration Update

The presentation details the transformational journey following the union with Heubach, creating a top-2 global pigment player with a legacy of over 200 years and about €1 billion in revenue. The combined entity has a global manufacturing footprint of 19 sites and 12 technical marketing centres supported by a 250+ global team. Key financial targets were reiterated: Revenue is projected to grow from ₹2,079 crore in FY23 (legacy business) to ₹9,800-10,200 crore in FY27 and ₹12,000-14,000 crore in FY29. EBITDA is targeted at ~₹800 crore for FY27 and ₹1,400-1,500 crore for FY29, with a goal to become net cash positive by FY29. Net debt has been reduced from a peak of ₹922 crore to ₹531 crore in Q1 FY27. The One SAP integration project is expected to go live in the current financial year.

Market Environment & Challenges

The market remains volatile due to the Gulf War crisis, which spiked energy costs and raw material prices (e.g., urea in India) and increased logistics lead times by 1-2 weeks. Customers are delaying purchases due to demand uncertainty. A cross-functional task force is managing these disruptions through safety stock build-up, a tight S&OP process, identifying alternate logistics routes, and working dynamically with customers.

Q1 FY27 Financial Performance (Pigment Business)

The results are broken down into Legacy Sudarshan and the Acquired Group (Heubach).

Legacy Sudarshan (Pigment-only):

  • Revenue from Operations: ₹730 crore in Q1 FY27 (up 26.4% YoY from ₹578 crore in Q1 FY26)
  • Business EBITDA: ₹127 crore (up 46.0% YoY)
  • Business EBITDA Margin: 17.4% (up 2.3 percentage points YoY)
  • Reported EBITDA was impacted by an inventorized overhead gain of ₹13 crore. Normalized EBITDA would be ₹114 crore (15.6% margin).

Acquired Group (Pigment-only):

  • Revenue from Operations: ₹1,973 crore in Q1 FY27 (up 4.9% YoY)
  • Business EBITDA: ₹128 crore (up 97.6% YoY)
  • Business EBITDA Margin: 6.5% (up 3.1 percentage points YoY)
  • The group was turned around from zero EBITDA to an EBITDA of ₹146 crore (~7%) in Q1 FY27.

Pigment Global (Combined):

  • Revenue from Operations: ₹2,605 crore in Q1 FY27 (up 6.0% YoY)
  • Business EBITDA: ₹257 crore (up 68.8% YoY)
  • Business EBITDA Margin: 9.8% (up 3.6 percentage points YoY)

RIECO Performance

RIECO, a part of the business, faced significant challenges:

  • Revenue from Operations: ₹1 crore in Q1 FY27 (down 25% YoY)
  • EBITDA: ₹-10 crore (down 4,792% YoY)
  • EBITDA Margin: -26.3%
  • The decline was due to challenges in execution from subcontracting manpower availability and delays in customer site readiness.

One Sudarshan Consolidated Performance

  • Revenue from Operations: ₹2,642 crore in Q1 FY27 (up 5.4% YoY)
  • Business EBITDA: ₹247 crore (up 63.0% YoY)
  • Business EBITDA Margin: 9.4% (up 3.4 percentage points YoY)
  • Reported EBITDA: ₹266 crore (up 61.4% YoY)
  • Profit Before Tax (excl. RPS impact): ₹164 crore (up 201.8% YoY)
  • Earnings Per Share (not annualized): ₹12.3 for Q1 FY27

Key Financial Ratios

  • Net Debt: Reduced to ₹531 crore as of Q1 FY27 (from a peak of ₹922 Cr in Sept '25).
  • Net Debt to Equity Ratio: Improved to 0.2 in Q1 FY27 from 0.3 in FY26.
  • Net Working Capital as % of Sales: 23.6% in Q1 FY27.
  • Return on Capital Employed (annualized): 22.7% for Q1 FY27.

Outlook

The company reaffirmed its FY27 guidance for the Acquired Group, projecting sales of ~€700 million and EBITDA of ~€35 million. Sudarshan enters FY27 with strong profitability momentum but acknowledges the need to navigate a challenging market environment driven by geopolitical uncertainty and GDP performance in core markets.

Shareholder Information (as of 30th June 2026)

  • NSE Ticker: SUDARSCHEM
  • BSE Ticker: 506655
  • Market Cap: ₹69,350 million
  • Free Float: 91.81%
  • Shares Outstanding: 7,86,27,576
  • Promoter Holding: 8.19%
  • FII/FPI Holding: 8.47%
  • Mutual Fund Holding: 25.17%
  • Other Holdings: 58.17%