Bodal Chemicals Limited — Q1 FY26 earnings call

Call held 12 Aug 2025

Management summary

Bodal Chemicals reported an 8% YoY revenue growth to ₹458 crores and a 40% YoY EBITDA growth to ₹52 crores in Q1 FY26, driven by better realizations. While the new benzene derivatives project added to overheads and faced margin pressure, the company is focused on improving utilization and debt reduction. Dye Intermediates and Dyestuff segments saw revenue degrowth, but Basic Chemicals and Chlor Alkali showed positive growth.

Highlights

  • Consolidated revenue of ₹458 crores, up 8% YoY, driven by better realization.

  • Absolute EBITDA grew 40% YoY to ₹52 crores, with a consolidated margin of 11.3%.

  • Basic Chemicals division showed strong growth of 15% YoY in revenue to ₹45 crores.

  • Chlor Alkali business revenue grew 8% YoY to ₹84 crores.

  • Benzene derivatives unit has started normal production and contributing to the top line.

Concerns

  • Dye Intermediates revenue degrew 4% YoY to ₹150 crores, primarily due to decreased raw material prices and non-operation of beta naphthol plant.

  • Dyestuff revenue degrew 10% YoY to ₹122 crores due to lower raw material prices.

  • Increased interest, depreciation, and other overheads from the Saykha's Benzene downstream project offset partial profitability of other divisions.

  • Sener Boya, the Turkish subsidiary, reported a ₹1.45 crores loss due to hyperinflation.

  • Benzene derivatives unit faces steep competition and slower demand, keeping margins under pressure.

Key financials

  1. Consolidated Revenue ₹458 Cr +8%YoY
  2. Consolidated EBITDA ₹52 Cr +40%YoY
  3. Consolidated EBITDA Margin 11.3%
  4. Consolidated PAT ₹9.53 Cr
  5. Standalone Revenue ₹447 Cr
  6. Standalone PAT ₹10.34 Cr

What they filed

Q1 FY27: revenue up 56.9%, net profit up 190.0% against the same quarter last year.

₹ Cr · quarterly
Line itemQ2 FY25Q3 FY25Q4 FY25Q1 FY26Q2 FY26Q3 FY26Q4 FY26Q1 FY27
Revenue423 435 446 445 472 +12%481 +11%577 +29%698 +57%
EBITDA32 46 50 50 23 −28%25 −46%70 +40%69 +38%
Net profit1 7 11 10 4 +300%2 −71%31 +182%29 +190%
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

SegmentRevenueYoY GrowthVolume
Dye Intermediates₹150 Cr-4%6,892 metric tons
Dyestuff₹122 Cr-10%3,741 metric tons
Basic Chemicals₹45 Cr15%56,731 metric tons
Chlor Alkali₹84 Cr8%20,557 metric tons
Benzene Derivatives———

Capital allocation

high confidence
  • Capex Capex disclosed
    • Capitalization of Saykha's Benzene downstream project
    Interest, depreciation and other overheads have increased at the company level on capitalization of Saykha's Benzene downstream project.
  • Debt Gross ₹507 Cr Cost 8.5%
    • Repayment Regular scheduled repayment of term debt ₹120 Cr
    See, present term debt is about INR507 crores and working capital is near INR350 crores. So there is a regular rather scheduled repayment of about INR120 crores in term debt. Plus we are targeting some asset sales of our Vatva plant as well as some part in Punjab also. So by selling that, whatever revenue comes realization comes that we want to deploy in repayment of debt only. So by end of current year, we are targeting at least a reduction of INR150 crores. It can be in the range of INR150 crores to INR175 crores reduction in term debt. And working capital will remain more or less in the same level. Cost of debt is 8.5% to 9%.
  • Liquidity Liquidity disclosed Company has ₹60 crores in deposits generating interest income.
    It is mainly interest income. So we have about INR40 crores to INR45 crores of deposits with bankers as per their requirement of term lender and another about INR15 crore deposit with electricity provider. So mainly the interest from this deposit is the regular other income for the company.

Guidance & targets

Revenue

  • FY26 Total Revenue Revenue · FY26 · High confidence ₹1,900 crores
    Yes, we are on track to achieve INR1,900 crores, near INR1,900 crores, about INR1,900 crores. That can be plus or minus 5%.

    — Mayur Padhya

  • FY26 Benzene Business Revenue Revenue · FY26 · Medium confidence ₹100 crores

    Previously ₹150 crores → ₹100 crores

    For the whole current year, I think we should do about INR100 crores of top line from the benzene business. See, earlier, we were targeting about INR150 crores turnover from this business in the current year, but there is some delay. And conservatively, we are targeting around INR100 crores of revenue. It can be even better than this.

    — Mayur Padhya

  • FY27 Benzene Business Revenue (Full Capacity) Revenue · FY27 · High confidence ₹300 crores
    Yes. Next year, we can have a full capacity utilization and turnover can be near INR300 crores.

    — Mayur Padhya

Profitability

  • FY26 Operating Income Profitability · FY26 · Medium confidence ₹35 crores
    Yes. So this is turnover and there is an operating income that can be about INR35 crores. So overall, you can say that we can cross INR1,950 crores revenue as a top line.

    — Mayur Padhya

  • ROI Profitability · next year · Medium confidence 7-8%
    So this will have about 7% to 8% ROI for the company in the next year.

    — Mayur Padhya

Capacity

  • Benzene Derivatives Utilization Capacity · Q3 FY26 · High confidence 70%

    From 30% today

    Currently, it is 30%. For the next quarter, it will be slightly improved. And then by Q3, it should cross 70%.

    — Mayur Padhya

  • Benzene Derivatives Utilization Capacity · Q4 FY26 · High confidence 80%

    From 30% today

    And by Q4, it should be maximum, which is around 80%.

    — Mayur Padhya

  • Chlor Alkali Capacity Utilization Capacity · coming couple of quarters · Medium confidence 90-95%
    We are targeting to improve capacity utilization near to 90% to 95% in coming couple of quarters.

    — Ankit Patel

Margin

  • Blended EBITDA Margin Margin · going ahead · Medium confidence 12-13%

    From 10-11% today

    Then I think blended, if we are doing about 10% to 11% right now, I think blended, we should be able to achieve a couple of percent more, I feel.

    — Ankit Patel

  • Long-term EBITDA Margin (Normal Market) Margin · Medium confidence 13-15%

    Previously 18-20% → 13-15%

    But I think in a normal market scenario, I think we can -- our goal is to reach around 14%. So -- but blended, it could be anywhere between 13% to 15%. That is in the market -- normal market scenario.

    — Mayur Padhya

Debt

  • Debt Reduction Debt · end of current year · High confidence ₹150-175 crores
    So by end of current year, we are targeting at least a reduction of INR150 crores. It can be in the range of INR150 crores to INR175 crores reduction in term debt.

    — Mayur Padhya

  • Debt Reduction Debt · next year · Medium confidence similar reduction
    Yes. Next year, we are targeting similar reduction in term debt.

    — Mayur Padhya

  • Net Debt to EBITDA Debt · Medium confidence near 2.5
    In other words, if I say we are targeting debt-to-EBITDA near 2.5.

    — Mayur Padhya

Market Share

  • TCCA Indian Market Share Market Share · 1-2 months · Medium confidence sizable share
    I think another 1 or 2 months, we should have a sizable share of the Indian market at a good price also.

    — Mayur Padhya

What to watch in Q2 FY26

Benzene Derivatives Utilization

Q3 FY26
Current 30%
Target 70%

Why it matters

Ramp-up of the new benzene derivatives project is key to its profitability and overall company performance.

Currently, it is 30%. For the next quarter, it will be slightly improved. And then by Q3, it should cross 70%.

Risks & concerns

  • Hyperinflation in Turkish subsidiary (Sener Boya)

    medium

    Sener Boya, the wholly-owned subsidiary in Turkey, experienced hyperinflation, resulting in a ₹1.45 crores loss in Q1 FY26.

    Management acknowledged

  • Steep competition and slower demand for benzene derivatives

    medium

    The benzene derivatives unit faces margin pressure due to high competition and subdued demand, despite starting normal production.

    Management acknowledged

  • Negative chlorine prices and disposal challenges

    medium

    Chlorine prices are still negative (₹1,500-2,000 negative in North India), and disposal of the quantity remains a challenge, though offset by caustic prices.

    Management acknowledged

  • Global disturbances and uncertainties impacting margins

    medium

    Since 2022, global disturbances (e.g., Ukraine-Russia war) have led to cyclical and pressured margins, making 18-20% EBITDA margins difficult to achieve in a normal scenario.

    Management acknowledged

  • Impact of TCCA imports prior to ADD implementation

    low

    Huge import quantities of TCCA were done by importers in anticipation of ADD, delaying the full impact of the duty on the company's sales.

    Management acknowledged

Q&A highlights

7 direct
Dye Intermediates volume decline and beta naphthol plant status Direct
See, major dye intermediate, if we consider then there is no degrowth. But our one of the product that is beta naphthol, we have not run the factory for beta naphthol for the quarter. So that's why we have considered Dye Intermediate volume, yes, there is a degrowth by around 400 metric tons or so.

Clarifies the reason for the 4% YoY degrowth in Dye Intermediates, attributing it to a specific plant not running rather than overall market weakness.

Asked by Aditya Khetan

Benzene derivatives volume and capacity utilization targets Direct
For PNCB and ONCB whatever we have run, the volume is 1,850 metric ton which is about 20% of the capacity. So PNCB, ONCB has a capacity of 3,000 metric ton per annum per month. And if we consider that, then about 20% utilization is there for PNCB, ONCB products. The utilization, which was around 20% in the quarter is now up to 30%. And it is within, I think, 3 months, that should cross the 70% mark the utilization because our the major consumption and customers are pharma based.

Provides specific volume and utilization figures for the new benzene derivatives plant and outlines the ramp-up timeline, crucial for assessing the project's contribution.

Asked by Aditya Khetan

Overall FY26 revenue guidance and margin expectations Direct
Yes, we are on track to achieve INR1,900 crores, near INR1,900 crores, about INR1,900 crores. That can be plus or minus 5%. And margins of 11%, 12%, right? Yes. So this is turnover and there is an operating income that can be about INR35 crores. So overall, you can say that we can cross INR1,950 crores revenue as a top line.

Confirms the full-year revenue guidance and provides an operating income target, giving investors a clearer picture of expected profitability.

Asked by Vignesh Iyer

Debt levels, cost of debt, and debt reduction plans Direct
See, present term debt is about INR507 crores and working capital is near INR350 crores. So there is a regular rather scheduled repayment of about INR120 crores in term debt. Plus we are targeting some asset sales of our Vatva plant as well as some part in Punjab also. So by selling that, whatever revenue comes realization comes that we want to deploy in repayment of debt only. So by end of current year, we are targeting at least a reduction of INR150 crores. It can be in the range of INR150 crores to INR175 crores reduction in term debt. And working capital will remain more or less in the same level. Cost of debt is 8.5% to 9%.

Details the company's current debt structure, cost of debt, and a concrete plan for debt reduction through asset sales, addressing a key capital allocation concern.

Asked by Deepesh Sancheti

Rajpura land sale rationale, proceeds, and future land use Direct
So Rajpura unit is the chlor-alkali unit. For chlor-alkali, selling chlorine is always a bottleneck. And we already have 4 adjoining ancillary units that consume chlorine. ... So we have we are selling almost about 8 acres of land to them. And this is not only -- this is not a real estate deal. This is more of a business deal, which is going to benefit both of us. So the prices the price of the land is not really too much because it's an invested area. So it's around INR5 crores that we will get for the land. ... So we total have about 125 acres. The existing plant is set up in about 50 acres only. So this has more than 70 acres of surplus land.

Explains the strategic decision behind selling land at the Rajpura unit, the amount of land, the proceeds, and clarifies that it's a business deal to secure a pipeline buyer for chlorine, rather than just a real estate transaction.

Asked by Aditya Khetan

Long-term EBITDA margin expectations given past performance Direct
Yes, that's 2014 to 2019 was a little different era. I think that was the time, I think, where Indian industry overall performed better, Indian chemical industry. I think most of the players, if you see that their numbers were at peak margin-wise and bottom line-wise. ... But I think in a normal market scenario, I think we can -- our goal is to reach around 14%. So -- but blended, it could be anywhere between 13% to 15%.

Provides a realistic long-term EBITDA margin expectation (13-15%) for normal market conditions, contrasting it with higher historical margins (18-20%) from a different industry cycle.

Asked by Mohit Chugh

TCCA pricing trend after ADD implementation Direct
Pricing has definitely increased a lot. It has increased by the duty amount. So the pricing of TCCA in the market is now around INR160. It has increased by around INR50, INR60. And it is, I think, just a matter of a month or two because there was a lot of imports right before the implementation of the duty.

Confirms the positive impact of Anti-Dumping Duty (ADD) on TCCA pricing, with prices increasing by ₹50-60, indicating potential for improved profitability in this segment.

Asked by Mohit Chugh

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Detailed narrative

Q1 FY26 Performance Overview and Growth Drivers

Bodal Chemicals reported a consolidated revenue of ₹458 crores for Q1 FY26, marking an 8% year-on-year growth. Absolute EBITDA increased by 40% year-on-year to ₹52 crores, resulting in a consolidated EBITDA margin of 11.3%. This growth was primarily attributed to better realization. However, increased overheads from the capitalization of the Saykha's Benzene downstream project partially offset profitability, as the project did not significantly contribute to the top line during the quarter.

Segmental Performance Analysis

The Dye Intermediates division recorded ₹150 crores in revenue, a 4% year-on-year degrowth, mainly due to lower raw material prices and the non-operation of the beta naphthol plant. Dyestuff revenue also saw a 10% degrowth to ₹122 crores. In contrast, Basic Chemicals revenue grew by 15% year-on-year to ₹45 crores, and Chlor Alkali revenue increased by 8% year-on-year to ₹84 crores. The company aims to improve Chlor Alkali capacity utilization to 90-95% in the coming quarters.

Benzene Downstream Project Update and Outlook

The Saykha's Benzene downstream products unit has commenced normal production, contributing ₹13 crores to the top line in Q1 FY26. Current utilization for PNCB and ONCB is about 20% of the 3,000 metric tons per annum capacity. Management targets to increase this utilization to 70% by Q3 FY26 and 80% by Q4 FY26. The company conservatively projects ₹100 crores in revenue from the benzene business for FY26, with a potential to reach ₹300 crores in FY27 at full capacity.

Strategic Land Sale at Rajpura Unit

Bodal Chemicals is in the process of selling approximately 8 acres of surplus land at its Rajpura chlor-alkali unit for ₹5 crores. This is viewed as a strategic business deal rather than a mere real estate transaction, aimed at securing a pipeline buyer for chlorine, which is a bottleneck product. The company retains over 70 acres of surplus land from its total 125 acres for future expansions, ensuring sufficient space for growth without needing to acquire more land.

Capital Allocation and Debt Management

The company's current term debt stands at ₹507 crores, with working capital at ₹350 crores. Management plans a scheduled repayment of ₹120 crores in term debt and aims to reduce overall debt by ₹150-175 crores by the end of the current fiscal year through asset sales. The cost of debt is between 8.5% and 9%. The long-term target for net debt to EBITDA is approximately 2.5, indicating a focus on deleveraging.

Margin Outlook and Industry Dynamics

Management noted that while historical EBITDA margins were in the 18-20% range during a different industry era (2014-2019), the current global environment (post-2022 Ukraine-Russia war) has led to cyclical and pressured margins. The company's current blended EBITDA margin is 10-11%, with a target to improve it by a couple of percentage points to 12-13% going forward. The TCCA segment is expected to see improved pricing (up by ₹50-60) and a 'sizable share' of the Indian market within 1-2 months due to the Anti-Dumping Duty.

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