Revenue rises 28.04%, but costs keep Himadri's margin below last year
Sequentially, margin recovered 1.34 percentage points as revenue grew faster than expenses, while other income remained 18.74% of pre-tax profit.
Filed 15 Jul 2026, 15:38 IST · after market close · Himadri Speciality Chemical Ltd (HSCL)
Key takeaways
- Consolidated revenue grew 28.04% YoY, but operating profit grew only 17.51% as expenses rose 31.00%.
- Net profit rose 27.36% YoY to Rs 228.43 cr, helped by a 1.65 percentage-point lower tax rate and other income equal to 18.74% of pre-tax profit.
- The stock rose 5.99% after the results, above its 2.26% median absolute move after the previous eight result announcements.
Price around the results
Growth improved, but profit conversion lagged revenue
Consolidated revenue grew 28.04% YoY and 11.19% QoQ, while net profit increased 27.36% YoY and 10.07% QoQ. The weaker YoY conversion reflects expenses growing 31.00%, alongside interest rising 41.57% and depreciation rising 45.49%. QoQ momentum was better because revenue growth exceeded expense growth.
Costs narrowed the YoY margin, while other income lifted profit quality concerns
Operating margin narrowed 1.80 percentage points YoY because expenses grew faster than revenue. It recovered 1.34 percentage points QoQ as revenue grew 11.19% against expense growth of 9.36%. Other income contributed 18.74% of pre-tax profit, so reported earnings were not driven entirely by operations; the YoY tax-rate decline of 1.65 percentage points also supported net profit growth.
Margin recovered from the Q4FY26 trough but remains below last year
Operating margin fell from 21.91% in Q1FY26 to 18.77% in Q4FY26 before recovering to 20.11% in Q1FY27. The recovery still left the margin 1.80 percentage points below the year-ago quarter. Himadri's margin was 1.39 percentage points above the 18.72% median for the 18 Commodities peers that had reported.
Management is linking the next phase to new-materials capacity
Management said it is targeting 200,000 MTPA of LFP cathode-material capacity and expects its 2,000 MTPA demonstration facility to commission in Q3FY27. The presentation said the Carbon Nano Tube facility is scheduled for Q4FY27, while the company is following a lab-first, plant-later approach to R&D-led expansion. Management also said the PCR business is entering the EV and SUV segments, with approximately 400 new SKUs targeted across its tyre categories.
The market reaction was larger than Himadri's usual results-day move
The stock rose 5.99% on the first session after the results and was up 8.80% on the following session. That was materially above the 2.26% median absolute move across the previous eight result reactions, during which the stock fell five times and rose three times. The first-session volume was 2.4 times the reference level.
Q1FY27 at a glance
Consolidated figures as filed with NSE — cross-checked against an independent source.
| Line item | Q1FY27 | Q4FY26 | QoQ | YoY |
|---|---|---|---|---|
| Revenue | ₹1,432 cr | ₹1,288 cr | +11.19% | +28.04% |
| Other income | ₹56 cr | ₹62 cr | -9.31% | +111.06% |
| Expenses | ₹1,144 cr | ₹1,046 cr | +9.36% | +31.00% |
| Operating profit | ₹288 cr | ₹242 cr | +19.10% | +17.51% |
| Operating margin (%) | 20.11% | 18.77% | — | — |
| Interest | ₹22 cr | ₹17 cr | +28.87% | +41.57% |
| Depreciation | ₹21 cr | ₹19 cr | +14.82% | +45.49% |
| Profit before tax | ₹301 cr | ₹268 cr | +12.18% | +24.58% |
| Tax | ₹72 cr | ₹60 cr | +19.42% | +16.52% |
| Net profit | ₹228 cr | ₹208 cr | +10.07% | +27.36% |
| EPS (₹) | ₹4.55 | ₹3.98 | +14.32% | +23.64% |
Operating margin of 20.11% compares with a Commodities sector median of 18.72% across 18 peers that have reported Q1FY27.
How the stock reacted
| Window | Stock | vs NIFTY |
|---|---|---|
| Results day | +5.99% | +6.01% |
| Next session | +8.80% | — |
| 5 sessions | +14.10% | +14.97% |
Volume on the results session was 2.40× 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.
Guidance & outlook
- The company targets 200,000 MTPA of LFP cathode material capacity.
- Birla Tyres is targeting commencement in Q2FY28 and gradual production ramp-up.
Expansion
- The 2,000 MTPA LFP cathode materials demonstration capacity is expected to commission in Q3FY27.
- The Carbon Nano Tube facility is scheduled for commissioning in Q4FY27.
- The Super Speciality Carbon Black facility is scheduled for commissioning in Q4FY28.
- The PCR facility is targeted for commissioning by FY28.
New products
- Birla Tyres is targeting approximately 400 new SKUs across agriculture, CIM, truck and bus, and emerging segments.
- Birla Tyres is entering the PCR segment with a primary focus on EVs and SUVs.
New initiatives
- The company is using a lab-first, plant-later strategy with R&D-led innovation before capacity investment.
Competition
- Birla Tyres is nearing double-digit market share in select geographies.
- The company targets increased market share through deeper distribution and a broader product range.
Problems & risks
- The company identifies increasingly stringent global regulatory requirements as a factor relevant to its sustainability approach.
What to watch
- Whether operating margin sustains the recovery from 18.77% in Q4FY26 to 20.11% in Q1FY27.
- Whether interest expense moves beyond the current Rs 22.41 cr after rising 41.57% YoY.
- Progress toward the 2,000 MTPA LFP demonstration capacity that management said is expected to commission in Q3FY27.