Fine Organic’s profit rose 20.97%, helped by lower tax and wider margins
Operating margin recovered 3.75 percentage points sequentially, but other income still made up 23.60% of pre-tax profit.
Filed 19 May 2026, 17:26 IST · after market close · Fine Organic Industries Ltd (FINEORG)
Key takeaways
- Consolidated net profit rose 20.97% year on year to Rs 117.49 cr as the tax rate fell 7.53 percentage points.
- Operating margin widened 1.06 percentage points year on year because revenue grew 3.05% while expenses grew 1.70%.
- Other income contributed 23.60% of profit before tax, making earnings quality an important watchpoint despite the 2.41% five-session stock gain.
Price around the results
Profit growth outpaced revenue in Q4FY26
Fine Organic Industries reported consolidated net profit growth of 20.97% year on year and 58.92% sequentially, while revenue grew 3.05% and 12.71%, respectively. Expenses grew more slowly than revenue in both comparisons, supporting operating profit growth of 8.59% year on year and 37.59% sequentially. The lower tax rate also lifted net profit: it fell 7.53 percentage points year on year to 17.72%.
Margin recovery came with higher raw-material and freight costs
Operating margin widened 1.06 percentage points year on year and 3.75 percentage points sequentially because revenue growth exceeded expense growth. Management said raw-material prices were higher in FY26 than in FY25 and rose slightly in Q4FY26 from Q3FY26, while freight costs increased in the quarter mainly because of the West Asia crisis. Interest expense also rose 276.39% year on year and 489.13% sequentially, although it remained a small part of the earnings bridge.
Margin moved back above the commodity-peer median
The 20.76% operating margin was 1.99 percentage points above the 18.77% median for 51 reported commodity-sector peers. The quarterly trend was uneven: margin fell from 22.63% in Q2FY26 to 17.01% in Q3FY26 before recovering in Q4FY26, so this was a rebound rather than a continued decline. Other income was 23.60% of profit before tax, which limits how much of the pre-tax improvement came from operations alone.
Expansion footprint widened while demand stayed stable
Management said exports accounted for around 55% of Q4FY26 revenue and domestic demand for 45%, with export markets steady and domestic demand improved during FY26. The company said its US subsidiary had invested USD 1.12 million and acquired approximately 160 acres in South Carolina for a manufacturing plant. Management also said the board approved acquiring up to 80% of Oleofine Organics in Malaysia for approximately Rs 83 cr, while a Dubai subsidiary was incorporated to build a GCC presence and improve supply-chain efficiency.
The initial stock reaction was modest versus its history
The results were filed after market close; the stock opened with a 1.50% gap and was up 0.59% on the first session, reaching a 2.41% gain after five sessions. That response was milder than the stock’s median absolute move of 2.71% after its last eight results. The historical pattern was usually negative, with six down reactions and two up reactions.
Q4FY26 at a glance
Consolidated figures as filed with NSE — cross-checked against an independent source.
| Line item | Q4FY26 | Q3FY26 | QoQ | YoY |
|---|---|---|---|---|
| Revenue | ₹625 cr | ₹555 cr | +12.71% | +3.05% |
| Other income | ₹34 cr | ₹21 cr | +63.28% | +30.02% |
| Expenses | ₹495 cr | ₹460 cr | +7.61% | +1.70% |
| Operating profit | ₹130 cr | ₹94 cr | +37.59% | +8.59% |
| Operating margin (%) | 20.76% | 17.01% | — | — |
| Interest | ₹3 cr | ₹0 cr | +489.13% | +276.39% |
| Depreciation | ₹18 cr | ₹14 cr | +31.01% | +21.56% |
| Profit before tax | ₹143 cr | ₹101 cr | +41.68% | +9.91% |
| Tax | ₹25 cr | ₹27 cr | -5.77% | -22.87% |
| Net profit | ₹117 cr | ₹74 cr | +58.92% | +20.97% |
| EPS (₹) | ₹38.32 | ₹24.11 | +58.94% | +20.96% |
Operating margin of 20.76% compares with a Commodities sector median of 18.77% across 51 peers that have reported Q4FY26.
How the stock reacted
| Window | Stock | vs NIFTY |
|---|---|---|
| Results day | +0.59% | +0.42% |
| Next session | +0.88% | — |
| 5 sessions | +2.41% | +1.19% |
| 15 sessions | +2.41% | — |
| 30 sessions | +14.00% | — |
Volume on the results session was 6.11× its 20-day average.
What management said
From the company’s own investor presentation. Each point is checked against the source document before it appears here.
This quarter
- Exports represented around 55% of total revenue in Q4 FY26, while domestic demand represented 45%.
- Overall demand was stable during FY26, with steady export markets and improved domestic demand.
Expansion
- Fine Organics Americas LLC was incorporated in the United States to set up a manufacturing plant.
- The US subsidiary invested USD 1.12 million and acquired approximately 160 acres of land in South Carolina.
- The Board approved a proposal to acquire up to 80% of Oleofine Organics Sdn. Bhd. in Malaysia.
- The proposed Malaysian acquisition is valued at approximately RM34.210 million, equivalent to about Rs 83 crores.
- The company infused about THB 22.50 million into its Thailand joint venture for business growth.
New initiatives
- Fine Organics FZE was incorporated in Dubai to establish a local presence in GCC countries and improve supply chain efficiency.
Problems & risks
- Raw material prices increased in FY26 compared with FY25 and rose slightly in Q4FY26 versus Q3FY26.
- Freight costs increased in Q4FY26, mainly because of the West Asia crisis.
- The company recorded an incremental gratuity provision of Rs. 7.11 crores following the new Labour Codes.
What to watch
- Whether operating margin holds above 20.76% after its recovery from 17.01% in Q3FY26.
- Whether other income remains below 23.60% of profit before tax.
- How raw-material and freight costs affect expenses after Q4FY26 cost pressure.