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Ashapura Minechem Limited — Q3 FY26 earnings call

Call held 11 Feb 2026

Management summary

Ashapura Minechem reported Q3 FY26 consolidated revenue of INR960.4 crores, a modest 0.8% QoQ growth, with EBITDA improving 8.3% QoQ to INR143 crores, driven by cost efficiencies. Despite these gains, results were slightly below expectations due to operational impacts from prolonged monsoons in Guinea and raw material volatility in India. The company remains optimistic about bauxite price stabilization and achieving its long-term volume targets through continued cost optimization and strategic partnerships.

Highlights

Consolidated revenue for Q3 FY26 stood at INR960.4 crores, showing a 0.8% QoQ growth.
EBITDA for Q3 FY26 was INR143 crores, an 8.3% QoQ growth, with EBITDA margin improving to 14.9% from 13.9% in Q2.
PBT before exceptional items for Q3 FY26 grew over 10% QoQ to INR89.31 crores, with margin at 9.3%.
Reduced demurrage charges, enhanced cost efficiency, and new logistics tie-ups significantly contributed to improved EBITDA margins.
Management is confident of achieving a long-term bauxite volume target of 15 million tons by FY27-28 and expects Guinea operating costs to be below $60/ton for the next quarter.

Concerns

Q3 FY26 results were slightly below expectations due to prolonged monsoon in Guinea impacting operations and volumes.
Indian operations faced headwinds from volatility in raw material costs and climatic changes.
Bauxite prices dropped due to suspended leases reopening, US-China trade deal uncertainty, and excess alumina supply.
An exceptional item of INR4.56 crores (consolidated) was recognized due to labor code impact.

Key financials

2 periods

Headline

Consolidated Revenue
₹960.4 Cr
QoQ +0.8%
Consolidated EBITDA
₹143 Cr
QoQ +8.3%
EBITDA Margin
14.9%
PBT (pre-exceptional)
₹89.31 Cr
QoQ +10%
PBT Margin
9.3%
Basic EPS
₹8.82
Exceptional Item (Consolidated)
₹4.56 Cr

9M

FY26 Consolidated Revenue
₹3,268 Cr
YoY +50%
FY26 Consolidated EBITDA
₹463 Cr
YoY +52%
FY26 EBITDA Margin
14.2%
FY26 PBT (pre-exceptional)
₹303 Cr
YoY +37%
FY26 PBT Margin
9.3%
FY26 Basic EPS
₹30.43

What they filed

Q1 FY27: revenue up 19.2%, net profit down 5.3% against the same quarter last year.

₹ Cr · quarterly

Line item	Q2 FY25	Q3 FY25	Q4 FY25	Q1 FY26	Q2 FY26	Q3 FY26	Q4 FY26	Q1 FY27
Revenue	604	865	555	1,356	952 +58%	960 +11%	1,969 +255%	1,616 +19%
Expenses	540	731	471	1,174	822	846	1,841	1,435
EBITDA	64	135	84	182	131 +105%	114 −16%	128 +52%	181 −1%
Margin	11%	16%	15%	13%	14%	12%	6%	11%
Other income	10	20	56	12	12	28	88	14
Interest	19	23	30	31	29	24	34	29
Depreciation	20	12	29	32	32	34	35	37
Profit before tax	36	119	82	132	81 +125%	85 −29%	147 +79%	130 −2%
Tax rate	-20%	10%	7%	14%	-30%	10%	18%	17%
Net profit	43	108	79	114	106 +147%	76 −30%	121 +53%	108 −5%
EPS	4.64	11.04	9.05	11.50	10.11	8.82	11.59	12.07

How to read this

₹ crore, as filed. The percentage beside a figure is the change against the same quarter a year earlier — never the quarter before, which would make every seasonal business look like it collapses and booms each year.

Segment breakdown

Guinea
76% Revenue Contribution
India
24.2% Revenue Contribution

Capital allocation

Capex Capex disclosed

We have a -- we as -- we are expecting that maybe compared to the capex we have done, another 20%, 25% more capex may come through over the next year or year and a half or so. But we -- what we think we can highlight is that the bulk of the capex is done and also having a good partners with us has reduced the capex, burden on us to some degree. So that's the comment what I can offer on the future capex as far as Guinea is concerned. I think India will also see some capex which we are finalizing.
Debt Debt disclosed

We expect at least that the debt is close to its peak or at peak really. We -- however, in the interest of growing the business, we may take little bit of time before we gradually start to retire the debt because as the volume grows, so will the working capital needs. And like we mentioned still there is a 20%-25% capex left over. While we may be able to manage that entirely from internal accrual, we do think we are close to our peak debt and definitely we might be here for some time, but gradually we expect maybe that after a year or so gradually we can start reducing the debt. But currently we don't see the addition of debt at least as of now I don't foresee that there will be a further addition of debt.

Guidance & targets

Volume

Long-term Bauxite Volume Volume · FY27-28 · High confidence 15 million tons

We would like to reiterate that we are very confident of achieving our long-term volume target of 15 million tons. This is for the '27- '28 as we as we have stated.

— Manan Shah
FY27 Bauxite Volume Volume · FY27 · Medium confidence 11.5-12 million tons

Can we put around say 11 and a half, 12 -- 12 million?

— Nalin Shah

Cost

Guinea Operating Cost per ton Cost · next quarter · High confidence below $60

we are confident of having costing below $60 definitely for the next quarter.

— Manan Shah

Bauxite Price

Bauxite Price Stabilization Bauxite Price · post Chinese New Year · Medium confidence stabilize and gradually pick up

we are optimistic about price stabilizing and maybe gradually pulling upwards after maybe the Chinese New Year.

— Manan Shah
Bauxite Price Floor Bauxite Price · medium term · Medium confidence $64-65/ton

we believe about 64, 65, but nowadays commodity markets are quite difficult to predict as I think world over this is going on that there is lot of volatility in all commodity prices. But at least we feel that floor can be very close to where we are.

— Manan Shah

Iron Ore Business

Volume and Realization Projection Iron Ore Business · end of Q4 FY26 · Medium confidence clear projection

we are very hopeful that we would be having a very clear projection for iron ore at the end of the quarter 4, that what can be the kind of volume and the kind of realization which we which we can expect.

— Manan Shah

EBITDA

EBITDA per ton moderation EBITDA · Medium confidence 40-50% moderation

I think that there can be a moderation, at least maybe there would be a 40%, 50% moderation, which which I expect that may come in the EBITDA, but we expect that the volumes to offset the per ton kind of the reduced EBITDA.

— Manan Shah

What to watch in Q4 FY26

Guinea Volume Ramp-up

next quarter

Current Impacted by monsoon in Q3

Target Significant ramp-up in Q4 FY26 and Q1 FY27

Why it matters

Volume growth is crucial to offset bauxite price moderation and achieve long-term targets.

we are internally very aggressive for ramping up in this basically for us the quarter four and quarter one are the best quarters. So our entire focus is on execution and volume.

Risks & concerns

Prolonged Monsoon in Guinea
medium

Impacted Q3 operations and volumes, leading to results slightly below expectations.

Management acknowledged
Bauxite Price Volatility
medium

Drop due to suspended leases reopening, US-China trade deal uncertainty, and excess alumina supply; management expects stabilization.

Management acknowledged
Bauxite Price Below $52/ton
medium

Management stated this price level would trigger a reconsideration of production strategy.

Management acknowledged
Raw Material Cost Volatility (India)
low

Affected Indian operations, though company is working on cost optimization.

Management acknowledged
Related Party Transactions
low

Analyst concern regarding high percentage of loans/advances/investments with related parties; management clarified compliance and operational necessity.

Analyst acknowledged

Q&A highlights

7 direct

Guinea Cost of Production and Delivery Direct

So for now what we can mention is that we our costing would be below even the current price of bauxite. However, detailed break-up would take time. The major components like I mentioned are sea freight, mining and logistics, and the transshipment costs.

Clarifies the major cost components and indicates that current costs are below bauxite prices, ensuring profitability.

Asked by Kamlesh Bagmar

Q3 Realization for Guinea Operations Direct

Revenue, I heard realization, sorry. Revenue, I think so we have given the in the segment-wise break-up, we have given that the total turnover from our Guinea business has come INR729 crores. Per ton the approx price would be around $70.

Provides specific revenue and approximate realization per ton for the Guinea segment in Q3.

Asked by Kamlesh Bagmar

Demurrage Charges in Q2 and Q3 Partial

So I think that we're not currently offering that kind of data, but I can tell you that one of the reason we were able to increase our EBITDA even compared to quarter 2... I can say a good part of that contribution -- I would even say maybe at about 20%, 25%, 30% of the improvement actually comes from the fact that our turnaround times for the shipments were much faster than quarter 2.

Explains the impact of reduced demurrage on Q3 EBITDA improvement without quantifying Q2 charges, and highlights new CQD terms for future freight contracts.

Asked by Naitik Mohata

EBITDA Sustainability at Current Bauxite Prices Direct

So we definitely expect... there can be a moderation, at least maybe there would be a 40%, 50% moderation, which which I expect that may come in the EBITDA, but we expect that the volumes to offset the per ton kind of the reduced EBITDA. We expect the volume growth to support us in this phase which-which we are expecting from now on, but yes, we do think that there may be a 40%, 50% moderation in EBITDA.

Addresses concerns about margin compression due to lower bauxite prices, indicating volume growth will be key to offsetting per-ton EBITDA moderation.

Asked by Naitik Mohata

Bauxite Price Floor for Production Reassessment Direct

Yes. If it is below $52, maybe then we have to reconsider our stand. Otherwise, we'll will be very comfortable till that number... But otherwise viability, yes, the business viability below 52 is definitely a concern.

Sets a clear threshold for bauxite prices below which the company would re-evaluate its production strategy.

Asked by Vardhaman Sancheti

Long-Term Ocean Freight Contracts Direct

So, these are fixed in the sense that that we have a long-term agreement when I say long-term, I think it's like 12 months... But this long-term agreement is giving us a edge in terms of the rate maybe there may be some like variable with the price of the freight index, but it is basically at a rate lower than the market rate.

Clarifies the nature and benefits of their long-term freight contracts in managing costs.

Asked by Pushkar Jain

Iron Ore Fe Content and Beneficiation Direct

Approximately we are around 45 to 50. And but this is beneficiatable, right, like it's improvable... it crosses 60, 61 after beneficiation.

Details the quality of their iron ore and its potential for upgrading, indicating value addition.

Asked by Pushkar Jain

Related Party Exposure Direct

Yes. You are right. I mean related party transactions are there, but be assured, I mean, it's all are within limit and with prior approval of the board, shareholders wherever it is required. And wherever it is operation need to do that transaction. So loans and advances also well within the limit and it's complied by each and every law which we are supposed to.

Addresses analyst concerns about related party transactions by assuring compliance and operational necessity.

Asked by Kush Bafna

3 min read 6 chapters

Detailed narrative

Q3 FY26 Performance Overview

Ashapura Minechem reported consolidated revenue from operations of INR960.4 crores for Q3 FY26, a modest 0.8% quarter-on-quarter growth. EBITDA for the quarter stood at INR143 crores, marking an 8.3% QoQ increase, with the EBITDA margin improving to 14.9% from 13.9% in Q2. Profit Before Tax (PBT) before exceptional items grew over 10% QoQ to INR89.31 crores, and basic EPS for the quarter was INR8.82. For the nine months of FY26, consolidated revenue reached INR3,268 crores (up 50% YoY), and EBITDA was INR463 crores (up 52% YoY).

Guinea Operations & Bauxite Market Dynamics

Guinea operations were the primary revenue driver, contributing 76% to Q3 FY26 consolidated revenue. However, performance was slightly below expectations due to prolonged monsoons impacting operations and preventing the achievement of planned volumes. The bauxite market experienced a price drop attributed to the reopening of suspended leases in Guinea, uncertainty around the US-China long-term trade deal, and excess alumina supplies from new smelters outside China. Management expects bauxite prices to stabilize and gradually pick up post-Chinese New Year, with a perceived floor around $64-65/ton, and Guinea remaining a dominant global supplier.

Indian Business Performance & Strategy

The Indian operations contributed 24.2% to Q3 FY26 revenue and faced challenges from volatility in raw material costs and climatic changes. Despite these headwinds, the company is focused on improving profitability and sales through the addition of value-added products. Ashapura Minechem aims for significant growth in its Indian business over the next two to three years, leveraging a diverse product portfolio that caters to approximately 10 industries including paint, paper, edible oil, steel, and construction.

Cost Optimization Initiatives

A significant factor in the Q3 FY26 EBITDA margin improvement was the reduction in demurrage charges and enhanced cost efficiency. The company has implemented new long-term tie-ups with mining and logistics contractors, including China Railway, and secured freight contracts on CQD (Customary Quick Despatch) terms, which eliminate demurrage. These initiatives have helped maintain a consistent shipping freight and are expected to drive Guinea operating costs below $60/ton for the next quarter, contributing to long-term cost sustainability.

Capital Allocation & Debt Outlook

Most of the capital expenditure in Guinea is largely complete, with an additional 20-25% expected over the next 1-1.5 years. India is also planning some capex, which is currently being finalized. Management believes the company's debt levels are currently near their peak. While there is an intention to gradually reduce debt, no further debt additions are anticipated in the near term, as internal accruals are expected to manage working capital needs as volumes grow.

Long-Term Vision & Growth Drivers

Ashapura Minechem reiterated its confidence in achieving a long-term bauxite volume target of 15 million tons by FY27-28, projecting a linear growth from 3 million tons in the previous year. The company is optimistic about the sustained high demand for aluminum metal, driven by sectors like EV production, aerospace, and defense, projecting a 7% CAGR. With bauxite reserves estimated to last 50 years and ongoing cost structure improvements, the company is focused on long-term value creation rather than short-term quarterly fluctuations.

This is an AI-generated summary of a publicly available earnings call transcript.

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