Styrenix Performance Materials Ltd (STYRENIX) Q2FY27 Concall Transcript - Sep-2026 Qtr
Moderator: Ladies and gentlemen, good day, and welcome to Styrenix Performance Materials Limited conference call. We have with us today from the management of Styrenix Performance Materials Limited, Mr. Rahul Agrawal, Managing Director; Mr. Bhupesh P. Porwal, Chief Financial Officer; Mr. Chintan Doshi, Manager Legal and Company Secretary; and SGA Team. As a reminder, all participant 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 the conference call, please signal an operator by pressing star, then zero on your touchtone phone. Please note that this
Moderator: conference is being recorded. Further, on behalf of the management of the company, we would also like to remind the participants that this call is being conducted subject to and in line with the disclaimer mentioned in the investor presentation as is available on the stock exchanges. I now hand the conference over to Mr. Bhupesh P Porwal. Thank you and over to you, sir.
Bhupesh P. Porwal (Styrenix Performance Materials Ltd): Thank you very much. Namaste, everyone, and a very warm welcome to our Q2 and H1 FY '27 earnings call. Thank you for taking the time to be here with us today. I hope you all have had a chance to go through the financial results and the investor presentation available on our website and stock exchanges. The global operating environment remained volatile during the quarter with geopolitical developments continuing to drive fluctuation in crude oil prices and contribute to broader macroeconomic uncertainties. In this involving landscape, evolving landscape, our focus remained on navigating input cost volatility, maintaining operational efficiency, and ensuring continuity of customer supplies while staying responsible to changing market dynamics and underlying demand trends. Further, our Phase 1 of our expansion plan remains on track and is expected to come on stream during the current financial year. I will now take you through the financial and operational performance for the quarter before we open the floor for the questions. First, on the standalone financial highlights. Coming to quarterly financial highlights on year-on-year basis, total income for Q2 FY '27 stood at INR 781 crores, a growth of 26.5%. EBITDA of Q2 FY '27 stood at 84.5 crores, a growth of 3.3%, and EBITDA margin stood at 10.8%. Profit after tax for Q2 FY '27 stood at INR 51.2 crores, a growth of 0.8%, and sales volume for quarter two FY '27 stood at 43.4 kt. For our half-yearly financials highlights, total income for H1 FY '27 stood at 1,551 crores, a growth of 15.8%. EBITDA for H1 FY '27 stood at INR 286 crores, a growth of 70%, and EBITDA margin stood at 18.4%. Profit after tax for H1 FY '27 stood at INR 188.5 crores, a growth of 78.4%, and sales volume for H H1 FY '27 stood at 82.4 kt. Now coming to consolidated financial highlights for the quarter, total income of Q2 FY '27 stood at INR 997 crores, EBITDA FY '27 stood at INR 75.6 crores and EBITDA margin stood at 7.6%. Profit after tax for Q2 FY '27 stood at INR 23 crores. Consolidated sales volume, which includes both India and Thailand, for Q2 stands at 55.1 kt. On our half-yearly financial highlights, total income for H1 FY '27 stood at INR 2,009.8 crores. EBITDA for FY F1 H1 FY '27 stood at INR 299.2 crores and EBITDA margin stood at 14.9%. Profit after tax for H1 FY stood at INR 161.5 crores. Consolidated sales volume, which includes both India and Thailand, for H1 FY '27 stood at 106 kt. With this, I conclude the financial highlights and we may now proceed for question and answers. Thank you very much.
Moderator: Thank you very much. We will now begin the question-and-answer session. Anyone who wishes to ask a question may press star and one on the touch-tone 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 will wait for a moment while the question queue assembles. The first question comes from the line of Nirav H. Jimulia from Anvil Wealth. Please go ahead.
Nirav H. Jimulia (Anvil Wealth): Yeah. Good afternoon, sir. Few questions from my side. So, sir, first is with respect to the newer capacity, which we are expecting by the end of this financial year. So obviously, that would be focus on improving volumes and the benefits of operating leverage accruing too. But just wanted to understand your thought like when we see the imports or map the imports coming to India, are they the in grades or
Nirav H. Jimulia (Anvil Wealth): volumes which can be replaced through our capacities which probably could be unique in terms of currently we not may we may not be producing, but those volumes may be coming to India, and we could take the benefits of that.
Rahul Agrawal (Styrenix Performance Materials Ltd): Hi, Nirav. Any other questions? You want to ask all your questions, so that I can answer all of them together? Yeah, yeah. Yeah.
Nirav H. Jimulia (Anvil Wealth): So, and the second question is on the polystyrene side, so since we took over the management control of the company, we have seen the ramp-up of the volumes in the polystyrene side. But have we realized the full potential of the EBITDA improvements when we had taken over the management control? So, I just wanted to understand it from the viewpoint of penetration into probably the application side of the customers, probably when earlier the management was not having and now we have started getting penetration into. So, just wanted to understand whether there is a scope of improvement in the EBITDA per kilo from the polystyrene side. And lastly, sir, in terms of whatever we have done for H1, do we believe that is there any scope for improvement in the volumes in H2 vis-à-vis H1 given the kind of current environment we are facing today? Thank you so much.
Rahul Agrawal (Styrenix Performance Materials Ltd): Thank you, Nirav, for your questions. So with regards to, you know, the newer capacities which are going to come online in this financial year, say towards the end of the financial year, there are certain, so for most of the products which are imported into the country, we have the capabilities to produce them in India already. However, for specific grades, or rather very few grades, one of them which stands out is the refrigeration liner ABS grade, and that is a grade which, you know, historically, none of the local players in India have had the capability to produce. With Thailand you know, technology that we have acquired, and also now the new capacity coming in India that we have, we would have the ability to cater to that to put to that volume as well. That volume typically in in India, so if 3.5 lakh ton, 4 lakh ton is the market in India, and the and the imports are roughly half, you know, you would have almost 30,000 to 40,000 tons of refrigeration liner ABS coming into the country. So, yes, to to a good extent, we would have the now the capability to cater to that market. For most of the other kind of business which comes into India, we already have the capability in terms of technology and, you know, recipes and you know, manufacturing ability. There is of course also the question of positioning at times where we have certain customers which are not of which are of origin from Korea or Japan which are present in India, which have historically preferred to buy products from outside of India, from certain suppliers. So, you know, again, with Thailand being online and us having the capability to supply to them from that region, from a positioning perspective, also with the new capacity coming in, we'll have the ability to cater to that demand as well. So, one is, of course, a more straightforward technology aspect, the other is a more nuanced positioning aspect, both of which we would be able to address with new capacities coming in. Of course, you know, the imports still remain higher relative to our capacities that come online at least as part of phase one, but we would be able to address some of that. With regards to polystyrene, you know, you know, there are two aspects of the polystyrene business. There is GPPS and HIPS. The way we have seen the market the HIPS business is where there is a larger percentage of you know, OEM driven demand, whether it is air conditioner, whether it's refrigerators or even a little bit on the packaging side. And earlier, prior to us taking over management of the company, the share of the OEM business in HIPS was extremely low, because the grades weren't developed, and you know, essentially the supply wasn't consistent for these customers historically. This is something that we have been able to correct, and today for the entire capacity of HIPS which runs around 35,000 to 40,000 tons, more than 70% to 80% of that demand of that capacity now is fulfilled by OEM demand, and this is what we have been able to see, and we have been able to realize that value as well in terms of an EBITDA potential as well you know, going forward. Of course, in the the first half of this year, there has been a lot of volatility across the board. Specifically, if you look at supplies of styrene, there have been some concerns from where we have historically bought styrene monomer, and that has led into
Rahul Agrawal (Styrenix Performance Materials Ltd): issues of how we perceive certain markets. The, the reason why I'm mentioning this is because when you look at again polystyrene, and specifically HIPS, the concerns are less, because again, it's an OEM business, formula-driven business, wherein you know, volatilities in supply chain can be passed on to the end customer. In the case of general purpose polystyrene, a very small percentage is actually OEM-driven. And consequently, we also have a very small percentage of OEM-driven demand within our portfolio. There is limited you know, opportunity to increase that because of the commoditized nature. Our entire, you know, we have had some loss of volume or it has been a conscious management decision not to participate in certain volumes, especially with regards to GPPS, in the second quarter. And that is also reflected while our volumes for ABS have gone up significantly, in the second quarter, the volumes for GPPS are also down, because we chose not to participate in some of the non-OEM demand for GPPS, because it was highly speculative in nature when we were procuring styrene monomer in the first quarter of this year for the second quarter. So, this is, this is a management call, and hence, you know, the volumes for polystyrene were lower. With a in kind of uncertainty, which still remains across the board, we believe with ABS still we will have an increase in volumes, because the first quarter was exceptional, volumes were lower, and there was a massive supply supply chain disruption. The supply chain disruptions continue, but we have developed alternate supplies for raw materials. And because of that, at least we know that we can procure it, albeit, you know, higher cost given the current environment. But, with that higher cost being, we're since we're being able to pass it on to the end customer, we believe the second half volumes of ABS will be in line with what we've already seen in the second quarter and you know, the business will be back to normal, unless again something unusual occurs. For polystyrene again, HIPS will remain as usual. For GPPS, that uncertainty continues, and you know, the management call always has been not to be very, you know, to be very speculative in buying raw materials, especially if a lot of the demand is based on spot and based on, you know, unorganized kind of markets.
Nirav H. Jimulia (Anvil Wealth): Perfect, sir. So, just a little bit on the commentary what you have given. From the ABS side, do we map in terms of the unique grades possibly where we are the only player and probably the competition won't be there in terms of market addressability? So, is there any percentages or is there any benchmark which on the basis of which you can say that these are the unique grades and possibly this could be the percentage of our overall ABS volumes from where this unique grades would be coming from?
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