GHCL

GHCL delivered a robust operational performance in Q4 FY25, with EBITDA increasing by 21.4% YoY to INR 244 crores, and the EBITDA margin expanding significantly to 30.2% from 23.8% in Q4 FY24. For the full year FY25, EBITDA grew by 7% to INR 966 crores, and PAT increased by 9% to INR 626 crores. Management attributed this improvement primarily to operational excellence, efficiency, and cost optimization efforts, rather than solely lower raw material costs.

The global soda ash market faced uncertainty due to weak demand in Western economies and geopolitical situations, leading to softer prices and increased imports into India. However, the Indian soda ash market remained relatively strong, growing around 5% in FY25, and is expected to grow by more than 5% going forward^⏳. Management noted that China's demand growth, robust in calendar year 2023 (10%) and 2024 (18%), has begun to moderate, potentially leading to a surplus.

GHCL's growth plans are on track, with the vacuum salt and bromine projects expected to be commissioned in Q3 FY26, contributing to growth from FY26. The greenfield soda ash project has an ultimate vision of 2 million tons, with a total capex of around INR 6,800 crores, and INR 4,200 crores allocated for the first phase. In FY25, the company spent INR 311 crores on growth capex, including greenfield, vacuum salt, bromine, and Zara Zumara projects.

Globally, approximately 2 million tons of new soda ash capacity (1.1 million in China, 0.9 million elsewhere) is expected to come online in the next 12 months, though some projects are being postponed. Management expects softer prices due to global market conditions. They also highlighted the absorption of Inner Mongolia's capacity in FY24-25 due to strong Chinese demand. The Minimum Import Price (MIP) policy in India has helped establish a floor price, leading to a reduction of 30,000-40,000 tons in imports in FY25 compared to the previous year.

Management identified the solar glass sector as a significant future demand driver for soda ash in India. The current soda ash demand from solar glass plants is around 11,000 tons per month, which is projected to double in FY26-27, translating to an additional demand of approximately 1.23 lakh tons. This growth is supported by government initiatives like the re-imposition of 10% duty on imported solar glass and increased focus on renewable energy.

GHCL maintains a strong balance sheet with INR 1,080 crores in cash and investments at the year-end, enabling financial agility and supporting growth initiatives. For FY25, the company generated INR 725 crores in cash profit after tax, out of which INR 114 crores was distributed as dividends to shareholders. The Board declared a 120% dividend, reflecting a commitment to stakeholder value.