Ashapura Minechem Limited

Ashapura Minechem reported a strong Q2 FY26, with consolidated revenue from operations growing 57% year-on-year to Rs. 952.5 crore. EBITDA more than doubled to Rs. 132.1 crore, achieving a margin of 13.9%, up from 10.8% in Q2 FY25. Profit Before Tax (PBT) surged 128% to Rs. 81.2 crore, with a margin of 8.5%. For the first half of FY26, consolidated revenue reached Rs. 2,308 crore (up 75% YoY), and EBITDA was Rs. 319.9 crore (up 105% YoY), maintaining a 13.9% margin.

The company's Guinea operations were a primary growth driver, with bauxite exports in Q2 FY26 reaching 1.33 million tons, nearly double the volume of the previous corresponding quarter. This growth was attributed to better planning, improved logistics arrangements, and maintaining good stock levels at the port. Management noted a slight correction in bauxite prices (approx. 3%) and a stronger local currency, leading to a minor dip in EBITDA per metric ton to USD 8.9 from USD 9.3 in Q1, largely offset by operational efficiencies.

Ashapura's Indian business demonstrated robust performance, achieving over 25% growth in H1 FY26 compared to the previous year's first half, despite the monsoon season. All four verticals – Bentonite & Allied Minerals, Performance Minerals, Specialty Absorbent Solutions, and Advanced Ceramic Materials – delivered stable performance and improved realizations. The company commenced production in two new bentonite mines in Kutch, expected to distribute 300,000 tons annually, and aims for a minimum 20% reduction in power costs at its bleaching clay plant through a 9-megawatt solar plant.

To enhance connectivity and access larger bauxite deposits, Ashapura completed a significant bridge project (estimated over Rs. 80 crore investment) in Guinea, expected to open on November 27, 2025. This bridge, 100 meters long and 60 meters above ground, will provide access to high-quality bauxite from the BOFFA mining area. Furthermore, the company's BOFFA and GSM port expansion projects are on track for completion by Q2 FY27, which will increase total handling capacity from 16 million metric tons to 27 million metric tons.

The company has initiated trial production for its iron ore business in Guinea, with commercialization expected within the next two quarters. Management is confident in achieving a target of 15 million metric tons of iron ore in FY27-28. While the iron ore business is expected to contribute meaningfully to the bottom line due to ex-mines transactions, its impact on the topline will be less significant compared to bauxite, which is primarily sold on a CIF basis. Initial commercial quantities are targeted at least 0.5-1 million tons per quarter within the next two quarters.

Ashapura is focused on long-term growth, aiming for 15 million metric tons of bauxite volume by FY27-28, with plans to grow beyond this. The company views Guinea as a stable mining destination, supported by the government, and is actively tracking other mineral opportunities in Africa. While acknowledging quarterly volatility due to logistics, management emphasized building infrastructure and partnerships to sustain long-term volume and improve EBITDA.