Costs surge as Styrenix margin falls to 7.23% in Q2FY27
Revenue was broadly flat sequentially, but expenses rose 16.58%, driving an 83.25% drop in consolidated net profit.
Filed 28 Oct 2026, 11:33 IST · Styrenix Performance Materials Ltd (STYRENIX)
Key takeaways
- Consolidated net profit fell 83.25% QoQ to Rs 23.17 cr as revenue slipped 1.72% while expenses rose 16.58%.
- Operating margin fell 14.56 percentage points to 7.23%, leaving Styrenix 7.35 percentage points below the 14.58% median for 28 reported commodity peers.
- The tax rate rose 15.94 percentage points to 42.62%, while other income accounted for 9.39% of pre-tax profit.
Price around the results
Q2FY27 profit reset on flat revenue
Styrenix’s consolidated revenue declined 1.72% QoQ, but expenses increased 16.58%, causing operating profit to fall 67.40%. Net profit dropped 83.25% to Rs 23.17 cr, while EPS fell 83.24% to Rs 13.18. The scale of the profit decline was therefore driven mainly by cost escalation rather than a revenue collapse.
Expense growth drove a 14.56-point margin drop
Operating margin narrowed from 21.79% to 7.23% because costs grew much faster than revenue. Interest expense rose 9.95%, while depreciation declined 0.59%, so the margin pressure was concentrated in operating costs. The tax rate also rose 15.94 percentage points to 42.62%, further reducing the conversion of pre-tax profit into net profit; other income contributed 9.39% of pre-tax profit.
Margin trails 28-peer commodity comparison
Styrenix’s 7.23% operating margin was 7.35 percentage points below the 14.58% median among 28 commodity-sector peers that had reported the quarter. Sequentially, this was a sharp reversal from the 21.79% margin in Q1FY27. The available quarter trend therefore points to a pronounced margin decline, rather than a small fluctuation.
Management points to volatility and capacity plans
Management said underlying demand remained robust despite geopolitical uncertainty and global supply-chain disruptions, while raw-material and energy availability and pricing remained volatile. It also said the Thailand business faced regional capacity overhang and competitive pressure. For the business response, management said the 50 KT brownfield ABS Phase I expansion remained on track for commissioning in H2 FY27 and that it was expanding value-added ABS and HRG rubber grades in Thailand.
Q2FY27 at a glance
Consolidated figures as filed with NSE — filed ahead of third-party databases, not yet independently cross-checked.
| Line item | Q2FY27 | Q1FY27 | QoQ |
|---|---|---|---|
| Revenue | ₹994 cr | ₹1,011 cr | -1.72% |
| Other income | ₹4 cr | ₹3 cr | +13.81% |
| Expenses | ₹922 cr | ₹791 cr | +16.58% |
| Operating profit | ₹72 cr | ₹220 cr | -67.40% |
| Operating margin (%) | 7.23% | 21.79% | — |
| Interest | ₹5 cr | ₹4 cr | +9.95% |
| Depreciation | ₹30 cr | ₹31 cr | -0.59% |
| Profit before tax | ₹40 cr | ₹189 cr | -78.59% |
| Tax | ₹17 cr | ₹50 cr | -65.81% |
| Net profit | ₹23 cr | ₹138 cr | -83.25% |
| EPS (₹) | ₹13.18 | ₹78.64 | -83.24% |
Operating margin of 7.23% compares with a Commodities sector median of 14.58% across 28 peers that have reported Q2FY27.
What management said
From the company’s own investor presentation. Each point is checked against the source document before it appears here.
This quarter
- Underlying demand remained robust during the quarter despite external headwinds.
Guidance & outlook
- Brownfield ABS Phase I expansion of 50 KT is on track for commissioning in H2 FY27.
New initiatives
- The company is expanding into value-added ABS and HRG rubber grades in Thailand.
- The company plans to use marketing teams in China, Vietnam, Indonesia, Japan and South Korea to build a diversified growth platform.
- The company will leverage HRG rubber, high-heat and refrigerator-liner ABS grades and cross-selling across APAC.
- The company is pursuing diversified raw-material sourcing, cost optimisation and an agile supply chain.
Competition
- The company says its Thailand business faces competitive pressures from significant regional capacity overhang.
Problems & risks
- The quarter faced significant geopolitical uncertainty and disruptions across global supply chains.
- The availability and pricing of key raw materials and energy remained volatile.
- The Thailand business faces significant regional capacity overhang and resulting competitive pressures.
What to watch
- Whether operating margin recovers from 7.23% after the 14.56-percentage-point sequential decline.
- Whether expenses moderate after rising 16.58% QoQ against a 1.72% revenue decline.
- Progress toward management’s stated H2 FY27 commissioning timeline for the 50 KT ABS Phase I expansion.