Himadri Speciality Chemical Ltd (HSCL) Q2FY27 Concall Transcript - Sep-2026 Qtr
Moderator: Ladies and gentlemen, you are connected for Himadri Speciality Chemical Limited conference call. Please note that the conference will begin shortly. Please stay connected.
Moderator: Ladies and gentlemen, good day, and welcome to the Himadri Speciality Chemical Limited conference call. As a reminder, all participants' lines will be in the listen-only mode, and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during this conference call, please signal an operator by pressing "*" then "0" on your touchtone phone. Please note that this conference is being recorded.
Moderator: Today on the call we have with us, Mr. Anurag Choudhary, CMD and CEO, and Mr. Somesh Satnalika, EVP, Tire and Strategy. Before we proceed with the call, I would like to give you a disclaimer that this conference call may contain forward-looking statements about the company, which are based on the beliefs, opinions, and expectations as of today. Actual results may differ materially. The statements are not the guarantee of the future performance and involve risks and uncertainties that are difficult to predict. A detailed safe harbor statement is is being given on page number two of the investors' presentation of the company, which has been uploaded on the stock exchange and on the company website. I now hand the conference over to Mr. Anurag Choudhary. Thank you, and over to you, sir.
Anurag Choudhary (Himadri Speciality Chemical Ltd): Thank you. Good evening, everyone. And thank you for joining us today. We deeply value your continued trust, confidence, and engagement with Himadri. Q2 FY27 was another important quarter in Himadri's transformation journey. Several initiatives we have spoken about over the past several quarters are now translating from research to qualifications, from capacity creation to customer engagement, and from strategic intent towards commercialization. Before discussing these developments in detail, let me briefly touch upon our financial performance for the period ended 30th September 2026. For H1 FY27, on a consolidated basis, revenue surpassed 3,000 crores, EBITDA exceeded 600 crores, and profit after tax crossed 450 crores. This performance reflects the strength of our business, an optimized product mix, operational efficiencies, and our continued focus on value-added products. Over the years, we have invested consistently in research and development, process engineering, manufacturing capabilities, customer relationships, and strategic partnerships. These investments are increasingly expanding our addressable markets, strengthening our competitive position, and creating the foundation for next phase of Himadri's growth. Let me begin with the area where this transformation is perhaps most visible: specialty and advanced materials. Across our new material platforms, our focus remains clear: develop differentiated technologies, validate them rigorously with customers, and scale them in a disciplined manner. Our 200 metric ton carbon nanotube facility remains targeted for commissioning in Q4 FY27. Carbon nanotubes represent an important next-generation material, with application across lithium-ion batteries, semiconductors, electronics, conductive applications, and other high-performance uses. In super specialty carbon black, our planned 6,000 metric ton capacity remains targeted for Q4 FY28. This represents the next step in our journey from specialty carbon black to super specialty grades towards highly engineered niche products designed for demanding applications. Our LFP cathode active material road map is also progressing well, with the initial 2,000 metric ton capacity targeted for commissioning in Q3 FY27. The initial capacity is designed to support customer qualifications and early commercial engagements, while also establishing the foundation for a significantly large scale-up opportunity. The progress in customer engagements, together with strong visibility on future demand, gives us confidence to move into the next phase of expansion with 40,000 metric ton per annum capacity planned for commissioning in next year. On the anode side, our capabilities continue to progress across synthetic graphite and next-generation silicon carbon technologies, strengthening our objectives of building a comprehensive battery material portfolio. We have already provided materials to leading domestic and global customers for their qualification process. Customers' feedback and engagements have been very encouraging. In anthraquinone and carbazole, our in-house engineering team has enabled us to accelerate execution, with full capacity, 5,300, now targeted for commissioning together in Q4 FY27. The reason we are doing two phase together is there that's so in order to avoid any shutdown of 3 months during the commissioning of Phase 2. This allows us to bring the entire capacity to market in one shot, enabling faster market penetration and market share gains. As you all are aware, this
Anurag Choudhary (Himadri Speciality Chemical Ltd): and margins. Importantly, let me inform you all these developments are increasingly bringing complimented by deeper and more frequent customer engagements. During the quarter we have entered into NDAs with Indian and international customers across battery materials, carbon nanotube and super specialty carbon black segments. Our EnerGEX specialty carbon black grades received approval for high-voltage cable and battery applications followed by commercial orders. For us this progression from research to qualification to customer relationship and commercial adoption thereafter is particularly important. It validates both the technology and the market opportunity. We continue to build ecosystem across lithium-ion battery value chain through our strategic investments and partnerships with the focus extending from material innovation and technology development to cell level validation and eventual commercial deployments. During the quarter we invested further in Sicona Battery Technologies. Sicona has also completed the acquisition of 100% of Advano in United States, adding valuable silicon anode intellectual property, a US-based pilot plant facility and additional R&D and cell testing capabilities. Further strengthening its commercialization roadmap, Sicona has secured Australian $45 million in funding from Australian Renewable Energy Agency to advance its next-generation silicon-carbon anode technology. These developments add significant technological and execution depth to the platform and reinforce our conviction in silicon-carbon as an important next-generation anode technology. Our strategic investment in International Battery Company further complements this ecosystem in a unique way. Through IBC, Himadri has access to a platform that bridges material innovation, cell level validation, and commercial deployment, providing us with a strategic advantage as we strengthen our presence across the lithium-ion value chain. Together, Sicona, IBC, and our in-house capabilities are creating a collaborative innovation system that spans material science, technology development, validation, and application. This gives us a differentiated position as the lithium-ion battery value chain continues to evolve. As our portfolio becomes increasingly sophisticated and global, our commercial architecture must evolve alongside it. During the quarter, we incorporated Hardik Impex FZCO in Dubai Airport Freezone Area as a wholly owned subsidiary. This provides a dedicated platform for global sales, marketing, strategic trading, and procurement, thereby enhancing our proximity to customers and suppliers across Middle East, Africa, and Europe. Simply put, as Himadri becomes more global in what it develops and manufactures, we must also become more global in how we reach markets. Global supply chain realignment is also creating a significant opportunity for India. Building domestic capabilities in advanced material can reduce import dependence, while creating global competitive manufacturing platforms. Our investments across CNT, super specialty carbon black, LFP, synthetic anodes, and silicon-carbon technologies align closely with this opportunity and with the larger vision of Atmanirbhar Bharat. Another significant development during the quarter was the proposed merger of Birla Tyres business with Himadri. Following the acquisition of Birla Tyres in October '23, we focused on restoring operations, modernizing the manufacturing infrastructure, upgrading equipments, rebuilding the distribution network, and refreshing the product portfolio. Commercial production resumed on 29th May 2025, and since then the business has steadily strengthened in to operating foundation and market presence. The board has proposed the demerger of tyre business from Dalmia Refractories, Dalmia Bharat Refractories Limited into Himadri Speciality Chemical Limited, subject to the requisites statutory, regulatory, creator, and shareholders' approvals. Strategically, the proposed transaction brings together complimentary capabilities across feedstock, specialty carbon black, R&D, manufacturing, and finished tyre production. Direct ownership should enable closer alignment across capacity utilization, modernization, capital allocation, and product development. More importantly, it creates opportunity to bring our understanding of carbon material closer to tyre engineering, particularly in specialized application where material performance can create meaningful differentiation. We therefore see this as a natural next phase
Anurag Choudhary (Himadri Speciality Chemical Ltd): mobility platform. As we enter the second half of FY27, our priorities are clear. We'll continue to strengthen our core business, accelerate customer qualification, commercialization across new material platforms, expand international presence, and progress the proposed merger of Birla Tyres. We remain confident in achieving our previously guided target of 1,100 crore plus PAT by FY28. This will be supported by the sustained performance of our core business and commissioning of new capacities over the coming periods. Our philosophy remains unchanged: invest patiently in science, execute with discipline, and scale when the technology and the market are ready. I would like to thank every member of Himadri family, our customers, business partners, shareholders, and stakeholders for their continued trust and support. With that, I'll now hand over the discussion to Mr. Somesh Satnalika for further details on financial performance and business outlook. We look forward for your questions to an engaging discussion. Thank you.
Somesh Satnalika (Himadri Speciality Chemical Ltd): Thank you Anurag ji, and good evening everyone. Now, let me take you through the key financial highlights for the quarter and half year ended 30th September 2026. On a standalone basis, our revenue from operations for Q2 FY27 stood at Rs. 1,543 crores, compared to Rs. 1,070 crores in Q2 FY26. EBITDA for the quarter came in at Rs. 308 crores, a growth of 27% year-on-year, compared with Rs. 243 crores in Q2 FY26. PAT stood at Rs. 240 crores, reflecting a 28% increase year-on-year, compared to Rs. 187 crores in the same quarter last year. For the first half year of FY27, revenue stood at Rs. 2,817 crores, while EBITDA reached Rs. 610 crores, up 28% year-on-year from Rs. 477 crores in first half of FY26. Profit after tax for the half year stood at Rs. 463 crores, up 25% year-on-year over Rs. 369 crores reported in H1 FY26. On a consolidated basis, revenue for, revenue for Q2 FY27 stood at Rs. 1,691 crores versus Rs. 1,071 crores in the same period last year. EBITDA for Q2 FY27 stood at Rs. 303 crores, recording a growth of 27% year-on-year, and PAT at Rs. 231 crores with a growth of 31% year-on-year. Our half year revenue stood at Rs. 3,123 crores, EBITDA at Rs. 616 crores, PAT at Rs. 460 crores, reflecting strong performance across all business segments. We continue to maintain a healthy liquidity position with a comfortable leverage profile. That is all from our side. We will now open the line for questions and answers. Thank you.
Moderator: Thank you very much. We will now begin with the question and answer session. Anyone who wishes to ask a question may press star and one on their touchtone telephone. If you wish to remove yourself from the question queue, you may press star and two. Participants are requested to use handsets while asking a question. Ladies and gentlemen, we'll wait for a moment while the question queue assembles. The first question is from the line of Sagar Jethwani from PhillipCapital PMS. Please go ahead.
Sagar Jethwani (PhillipCapital PMS): Yeah, thank you for the opportunity. Sir, firstly what explains the sharp moderation in the gross margins during the quarter? Are there any one-offs and when can we see the recovery? So, that is my first question. I have a few more questions.
Anurag Choudhary (Himadri Speciality Chemical Ltd): Yeah, thank you. So, if you actually see the margins are stable. And if you compare with the corresponding quarter last year, there's been significant growth in the margins. So, as we told last time also, the right way to look at is per metric ton EBITDA. So, per metric ton EBITDA is around 21,000, which in the sequential quarter was at around 22,700-800. And in the corresponding quarter, that is the last year, it was at around 17,900. So, if you see on a year-on-year basis, it has gone from 17,900 to 21,000 level. But if you look on a sequential basis, it has come down, which is
Anurag Choudhary (Himadri Speciality Chemical Ltd): adjustments which happens in a business and there's nothing significant. So we are confident of achieving EBITDA about 20,000 on a sustainable basis and this will strengthen in the quarters to come.
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