Godavari Bioref.

Godavari Biorefineries reported a total income of INR2,000 crores for FY26, marking a 6% year-on-year growth from INR1,886.9 crores. EBITDA for the year grew by 15.8% to INR139 crores, with margins stabilizing at 7%. Notably, the company achieved a positive Profit After Tax of INR3.5 crores in FY26, a significant turnaround from a loss in FY25, despite certain exceptional factors. This performance was supported by a 32% reduction in finance costs to INR49 crores, following debt repayment of INR240 crores in FY25.

The fourth quarter of FY26 demonstrated a strong operational recovery, with revenue from operations reaching INR564 crores and EBITDA at INR92 crores, translating to an EBITDA margin of 16.2%. This represents a significant quarter-on-quarter improvement, as EBITDA more than doubled compared to Q3 FY26, and margins expanded from 9.8% to 16.2%. Profit After Tax for Q4 FY26 stood at INR52.9 crores, a substantial recovery from INR8.3 crores reported in Q3 FY26, indicating healthy underlying business momentum.

The company is accelerating its structural shift towards sustainable and bio-based alternatives, driven by geopolitical volatility and government support for ethanol blending. The 200 KLPD grain-based distillery is progressing well, with commissioning trials expected by June 2026, adding approximately 60 million liters of annual ethanol capacity. This expansion, along with a stronger outlook for the bio-based chemical segment from Q1 FY27, is expected to enhance profitability and resilience.

For FY26, the integrated sugar, ethanol, and co-generation business reported revenues of INR1,383 crores and EBITDA of INR97.4 crores, an increase of 19% year-on-year. The bio-based chemical segment achieved revenues of INR578 crores, with specialty chemicals contributing 61% of the total, up from 58% year-on-year. The ethanol business sold approximately 98 million liters of ethanol across various grades, contributing INR658 crores in revenue. The consumer business 'Jivana' also showed strong growth, with revenues of INR129 crores in FY26.

Godavari Biorefineries is strengthening its innovation capabilities, including expanding its global research footprint. The company has completed safety trials for its oral therapy candidate for triple-negative breast cancer and is preparing an application to CDSCO for preliminary efficacy research, with trials expected to commence after approval. Additionally, the DME project's pilot plant is currently running, with further research expected to take 3 to 6 months to assess its commercial viability.

The company faced margin pressure during parts of FY26 due to elevated feedstock costs and an increase in sugarcane prices without a corresponding rise in sugar MSP or ethanol blend prices. Geopolitical developments in West Asia also led to supply chain disruptions and increased freight costs, impacting the chemicals segment in Q4. However, the company's stable energy costs, primarily from bagasse, provide a competitive advantage in the global market, and the narrowing gap between fossil and renewable prices is creating new opportunities for bio-based solutions.