Profit rose 33.49% as other income cushioned a third margin drop
Costs grew faster than revenue and operating margin fell to 18.77%, while other income contributed 23.18% of pre-tax profit.
Filed 23 Apr 2026, 16:12 IST · after market close · Himadri Speciality Chemical Ltd (HSCL)
Key takeaways
- Consolidated net profit rose +33.49% YoY to Rs 207.53 cr, despite operating profit growing only +3.61% as other income and a lower tax rate lifted earnings.
- Expenses grew +16.05% YoY against revenue growth of +13.50%, narrowing operating margin by 1.79 percentage points to 18.77%.
- The stock gained +5.59% after the results, well above its 0.99% median absolute move after the last eight results, although corporate-action overlap limits the earnings read-through.
Price around the results
Q4 revenue momentum did not translate into operating profit growth
Consolidated revenue increased +13.50% YoY and +8.80% QoQ, but operating profit grew only +3.61% YoY and declined -0.36% QoQ. The gap reflects weaker operating leverage, with expenses rising faster than revenue in both comparisons. Net profit still increased +33.49% YoY and +8.07% QoQ.
Higher costs and financing charges pressured the margin
Expenses grew +16.05% YoY and +11.16% QoQ against slower revenue growth, reducing operating margin by 1.79 percentage points YoY and 1.73 percentage points QoQ. Interest expense rose +98.52% YoY and +6.23% QoQ, adding to the pressure below operating profit. Other income accounted for 23.18% of pre-tax profit, while the tax rate fell by 8.18 percentage points YoY and 2.23 percentage points QoQ, making reported net profit less reflective of operating performance.
Operating margin has declined for three straight quarters
Operating margin fell from 21.91% in Q1FY26 to 21.73% in Q2FY26, 20.50% in Q3FY26 and 18.77% in Q4FY26. The Q4 margin matched the 18.77% median among 51 reported Commodities peers, placing Himadri around the middle of the sector distribution rather than above it.
New carbon black capacity and LFP plans define the expansion agenda
The company said total carbon black capacity reached 250,000 MTPA, including 130,000 MTPA of speciality carbon black, after commercial operations began on a 70,000 MTPA speciality line at Mahistikry. Management said it plans to produce 200,000 MTPA of LFP cathode active material over five to six years, with the first 2,000 MTPA targeted for commencement by Q3FY27. The presentation also said the forward-integration plant carries expected capex of Rs 120 cr and is planned for commissioning by Q2FY27.
The post-result rise was unusually large for this stock
The stock gained +5.59% on the first reaction day and +13.74% after five sessions, compared with a 0.99% median absolute move after the last eight results; those reactions were split between three rises and five declines. The first-day move also came with 21.81x volume, but a corporate-action overlap means it was not a clean earnings-only reaction.
Q4FY26 at a glance
Consolidated figures as filed with NSE — cross-checked against an independent source.
| Line item | Q4FY26 | Q3FY26 | QoQ | YoY |
|---|---|---|---|---|
| Revenue | ₹1,288 cr | ₹1,184 cr | +8.80% | +13.50% |
| Other income | ₹62 cr | ₹47 cr | +33.27% | +359.25% |
| Expenses | ₹1,046 cr | ₹941 cr | +11.16% | +16.05% |
| Operating profit | ₹242 cr | ₹243 cr | -0.36% | +3.61% |
| Operating margin (%) | 18.77% | 20.50% | — | — |
| Interest | ₹17 cr | ₹16 cr | +6.23% | +98.52% |
| Depreciation | ₹19 cr | ₹18 cr | +5.52% | +35.20% |
| Profit before tax | ₹268 cr | ₹255 cr | +4.95% | +19.41% |
| Tax | ₹60 cr | ₹63 cr | -4.51% | -12.38% |
| Net profit | ₹208 cr | ₹192 cr | +8.07% | +33.49% |
| EPS (₹) | ₹3.98 | ₹3.84 | +3.65% | +26.35% |
Operating margin of 18.77% 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 | +5.59% | +6.72% |
| Next session | +6.42% | — |
| 5 sessions | +13.74% | +13.97% |
| 15 sessions | +2.85% | — |
| 30 sessions | +26.73% | — |
Volume on the results session was 21.81× 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
- Himadri's total carbon black capacity reached 250,000 MTPA, including 130,000 MTPA of speciality carbon black.
Guidance & outlook
- The company expects significant sustainable profitability growth over the next two years.
- The company plans to produce 200,000 MTPA of LFP cathode active material over the next five to six years.
- Phase I's first 2,000 MTPA LFP capacity is targeted to commence by Q3FY27.
- The balance Phase I LFP capacity will be progressively commissioned over the following 12 months, with full operations envisaged in FY29.
- Li-ion battery demand is expected to grow about 27% annually to around 4,700 GWh by 2030.
Expansion
- Himadri commenced commercial operations of a 70,000 MTPA speciality carbon black line at Mahistikry.
- The new speciality carbon black capacity is expected to drive revenue growth and strengthen margins over the medium and long term.
- The company expects to spend Rs. 120 crores on the forward-integration plant, which is planned for commissioning by Q2FY27.
- The company is setting up a facility to extract Anthraquinone and Carbazole from existing coal tar distillates.
New initiatives
- The company is developing an environmentally friendly, cost-optimised process for producing Li2CO3.
- The company is exploring strategic interest in phosphate mines to secure a key raw material for LFP.
- The company has an exclusive partnership to localize and commercialize Sicona's Silicon-Carbon anode technology in India.
What to watch
- Whether operating margin recovers from 18.77% after three consecutive quarterly declines.
- Progress toward the management-stated 2,000 MTPA LFP milestone targeted for Q3FY27.
- Whether other income remains near its 23.18% share of pre-tax profit or operating earnings contribute more of net profit.