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    Gulf Oil Lubric.

    GULFOILLUBGood
    Oil, Gas & Consumable Fuels·6 Nov 2025
    Management Summary

    Gulf Oil Lubricants delivered a robust Q2 and H1 FY26, marked by strong volume growth across key segments like B2C, rural, and OEM franchisee workshops, significantly outperforming industry averages. The EV charging business, Tirex, showed exceptional growth, reinforcing its strategic importance. While profitability was slightly impacted by rupee depreciation and a one-time forex loss, management remains confident in achieving its 12-14% EBITDA margin band and 2-3x market growth, driven by positive H2 market dynamics and strategic initiatives. Cash flow generation was lower due to seasonal factors.

    Highlights

    7

    • Q2 Lubricants volume grew 9.5% to 40,500 KL, significantly outpacing the market's 3% growth.

    • H1 FY26 saw double-digit volume growth for lubricants (10.1%) and revenue growth of 12.6%.

    • AdBlue volume surged 24% in Q2 to 36,000 KL, with H1 growth at 10.4%.

    • Tirex, the EV charger subsidiary, reported H1 revenue of Rs. 42 Cr, a 75% growth YoY, with a target of Rs. 300-400 Cr top line in 3-4 years.

    • Q2 EBITDA grew 10.56%, contributing to double-digit H1 EBITDA growth, despite a Rs. 6 Cr mark-to-market forex loss impacting PAT (3-3.5% growth).

    • The company maintains its EBITDA margin guidance in the 12%-14% band, expecting improvement in H2.

    • Cash flow from operations for H1 FY26 was Rs. 24 Cr, a significant decrease from Rs. 131 Cr in the prior year, attributed to seasonal impacts.

    What Changed2

    vs Q3 FY26

    Guidance items7 → 5 (-2)Q&A highlights8 → 3 (-5)
    Key financials

    Metrics

    11

    Periods

    3

    Headline

    4
    • Lubricants Volume
      40,500 KL
      YoY+9.5%
    • AdBlue Volume
      36,000 KL
      YoY+24%
    • EBITDA Growth
      10.6%
    • PAT Growth
      3%

    Q2

    1
    • Mark-to-market Forex Loss
      ₹6 Cr

    H1

    6
    • Revenue Growth
      12.6%
    • Lubricants Volume Growth
      10.1%
    • AdBlue Volume Growth
      10.4%
    • EBITDA Margin
      12.3%
    • Tirex Revenue
      ₹42 Cr
      YoY+75%

    Segment breakdown

    B2C Personal Mobility
    — Growth
    Agri Sector
    — Growth
    B2B (Industrial, Infrastructure, Mining)
    — Growth
    OEM (Franchisee Workshops)
    — Growth— Volume
    List

    Guidance & targets

    5
    CategoryTargetPriority
    Profitability
    EBITDA Margin
    12% to 14%
    		Medium
    Profitability
    EBITDA Margin
    12% to 14%
    		High
    Volume
    Market Growth Multiplier
    2 to 3x
    		High
    Revenue
    Tirex Top Line
    Rs. 300-400 Cr
    		High
    Capex
    Tirex Investment
    Rs. 38 Cr
    		High

    Risks & concerns

    4
    RiskSeverity

    Rupee depreciation and forex volatility

    A 3.5% rupee movement in Q2 led to a Rs. 6 Cr mark-to-market forex loss, impacting PAT. Management notes that forex volatility can affect margins. — Management acknowledged

    medium

    Seasonally impacted cash flow generation

    Q2 is typically a monsoon quarter with lower vehicular movement and construction, leading to elongated collection cycles and lower cash flow from operations (Rs. 24 Cr in H1 vs Rs. 131 Cr last year). — Management acknowledged

    low

    Crude oil price movement and base oil supply challenges

    Crude oil price volatility and global demand/supply challenges in base oil markets can impact margins, although some reduction in base oil prices was observed in October. — Management acknowledged

    medium

    Areas of Evasion(1)

    • Tirex valuation details

    Q&A highlights

    3

    “Margin-wise, we always keep guiding that our EBITDA margin will be in a band of 12% to 14%... This is a seasonally impacted quarter in terms of collections because vehicular movement is low, construction activities are slower. Obviously, the collection cycle is slightly elongated in this quarter -- in the second quarter usually.”

    Directly addresses core profitability and operational efficiency concerns, highlighting seasonal impacts on cash flow and providing context for the significant drop in H1 cash flow from operations.

    asked by Varun from Equitree Capital

    2 min read5 chapters

    Detailed Narrative

    01

    Robust Q2 & H1 FY26 Performance Outpacing Market Growth

    Gulf Oil Lubricants delivered a strong Q2 FY26, with lubricants volume growing 9.5% to 40,500 KL, significantly outperforming the overall market growth of 3%. For H1 FY26, the company achieved double-digit volume growth of 10.1% for lubricants and a 12.6% increase in revenue. This robust performance was driven by healthy double-digit growth across key segments including B2C Personal Mobility, the rural/agri sector, B2B (industrial, infrastructure, mining), and OEM franchisee workshops.

    02

    AdBlue and EV Charging Business (Tirex) Show Significant Momentum

    The AdBlue segment continued its strong trajectory, with Q2 volumes surging 24% to 36,000 KL, contributing to a 10.4% growth for H1. The EV charger subsidiary, Tirex, demonstrated exceptional growth, reporting H1 revenue of Rs. 42 Cr, a 75% increase compared to Rs. 24 Cr in the previous year. Management has a clear strategic vision for Tirex, projecting it to achieve a top line of Rs. 300-400 Cr within the next 3-4 years, and has approved an additional Rs. 38 Cr investment to increase its holding from 51% to 65%.

    03

    Profitability Impacted by Forex, Margins Maintained within Band

    Despite strong operational performance, Q2 PAT growth was slightly lower at 3-3.5% due to a significant 3.5% rupee depreciation within the quarter. This resulted in a Rs. 6 Cr mark-to-market forex loss recorded in finance costs. However, Q2 EBITDA still grew by 10.56%, contributing to double-digit H1 EBITDA growth, with H1 EBITDA margin around 12.3%. Management maintains its full-year EBITDA margin guidance in the 12%-14% band, expecting improvement in H2 if the rupee stabilizes and crude prices remain in the $65-70 range.

    04

    Strategic Initiatives and Positive H2 Market Outlook

    The company's 'Unlock 2.0' strategy, focusing on premium products and segment acceleration, is yielding results, supported by programs like M-Power for mechanics and new product launches like Gulf Syntrac. Management expects to continue growing 2-3x the industry growth rate of 3-4%. The H2 outlook is bullish, anticipating strong demand from the festive and marriage seasons, positive rural sentiment, and the beneficial impact of recent GST cuts on the automotive sector, which reduced rates for commercial vehicles, petrol hybrids, and tractors.

    05

    Cash Flow and Treasury Management Strategy

    Cash flow generation from operations for H1 FY26 was Rs. 24 Cr, a notable decrease from Rs. 131 Cr in the previous year, attributed to Q2 being a seasonally impacted quarter with elongated collection cycles. The company maintains a robust cash balance of Rs. 1,100 Cr, strategically deployed as a 'war chest' for potential M&A opportunities, particularly in the EV space. Foreign exchange exposure on imported products (70% of products) is managed through a Board-approved hedging policy, typically covering 50-75%.

    This is an AI-generated summary of a publicly available earnings call transcript. It is for informational purposes only and does not constitute investment advice, a recommendation, or an endorsement. inve.money is not a SEBI-registered investment advisor. Please consult a qualified financial advisor before making any investment decisions.