Chembond Chemicals Limited

Chembond Chemicals, founded 50 years ago, currently employs 950 individuals and reported a consolidated revenue of ₹290 crores in FY25. The company recently completed the demerger of its construction chemicals and water treatment businesses. It is listed on both BSE and NSE, with its head office in Navi Mumbai and three manufacturing plants located in Gujarat, Himachal Pradesh, and Tamil Nadu.

For Q2 FY26, consolidated revenue stood at ₹73.04 crores, a 3% decline year-on-year from ₹75 crores. Despite this, consolidated EBITDA grew 14% YoY to ₹11.08 crores, and PBT increased 6% YoY to ₹9.62 crores, primarily due to improved gross margins and cost optimization. On a half-year basis, H1 FY26 consolidated revenue was ₹138.40 crores, down 1% YoY from ₹139.8 crores. However, H1 FY26 consolidated EBITDA rose 15% YoY to ₹21.89 crores, and PBT increased 13% YoY to ₹19.42 crores, with PAT reaching ₹13.5 crores, up 9.8% YoY.

The Water Technologies segment is the largest contributor, accounting for 85-87% of the total business. It grew 4% in Q2 FY26 and 2.65% in H1 FY26, reaching ₹120 crores. The segment holds a healthy order book exceeding ₹100 crores, comprising ₹85-90 crores in chemicals and ₹10-12 crores in equipment. The company anticipates invoicing ₹40-45 crores from this new order book within the current fiscal year and aims for 10-15% year-on-year growth, while working to maintain/improve margins in the 8-10% range.

The Construction Chemicals segment, which includes admixtures, sealants, waterproofing, and repair products, contributed 7% to total revenue in H1 FY26, down from 8% in H1 FY25. This segment experienced a 6% decline in H1 FY26 and a downward trend in Q2 FY26, largely attributed to the prolonged monsoon season impacting sales. Management expects a recovery and improved performance in the second half of FY26 as market activities pick up.

The Cleaning & Hygiene segment, a joint venture with Chembond Calvatis, focuses on industrial applications (beverage, dairy, food processing) and institutional applications (kitchens, laundry, housekeeping). This segment grew 3% in H1 FY26 and maintained its 1% contribution to total revenue, indicating steady but smaller-scale expansion.

The Chemical Distribution division imports and sells specialty chemicals for various applications, including water treatment and construction chemicals. This segment saw a significant 30% decline in H1 FY26, reducing its revenue share from 8% to 6%. The company is actively pivoting its product basket towards more unique offerings to counter commoditization, expecting sales to be depressed for about a year before recovering strongly in the years to come.

Chembond Chemicals has set an ambitious internal target to achieve a ₹1000 crore revenue milestone within approximately four years. This growth will be pursued through a multi-pronged strategy involving organic expansion, inorganic opportunities, and diversification. The company emphasizes its differentiation through application expertise, long-standing customer relationships, and deep industry knowledge, acknowledging challenges from price-aggressive competitors and industrial slowdowns but maintaining a positive revenue outlook for H2 FY26 across all business units.