Huhtamaki India Limited — Q3 FY26 earnings call

Call held 13 Feb 2026

Management summary

Huhtamaki India reported a strong financial performance for Q4 and full year 2025, driven by significant profit growth and improved operational efficiencies, despite a slight decline in volumes. The company emphasized its strategic focus on profitable growth, capital discipline, and accountability, alongside notable progress in sustainability. Management addressed concerns regarding stagnant top-line growth and high charges from the parent, outlining plans for organic growth and continued operational improvements.

Highlights

  • Q4 CY25 PBT significantly higher at INR 410 million compared to INR 152 million in Q4 2024.

  • FY25 PBT (before exceptional items) grew 83% to INR 1.57 billion from INR 860 million in FY24.

  • Net profit after tax for FY25 increased to INR 1.182 billion from INR 880 million in FY24.

  • Significant reduction in recordable incidents and lost time injuries by approximately 50% YoY.

  • Achieved 0 liquid discharge at Khopoli, Rudrapur, and Silvassa sites.

Concerns

  • Volumes were largely steady/flat QoQ but decreased slightly year-on-year for Q4 and FY25.

  • Top-line growth has been stagnant for several years, with management acknowledging it's a challenge.

  • Analyst concern regarding high IT charges paid to the parent company (INR 80 crores for FY24).

Key financials

  1. Net Sales Q4 6,000 Mn 0%YoY
  2. Net Sales FY25 23,900 Mn -2.5%YoY
  3. PBT Q4 410 Mn +169.7%YoY
  4. PBT FY25 (pre-exceptional) 1,570 Mn +82.5%YoY
  5. Net Profit Q4 (post-exceptional) 303 Mn +158.9%YoY
  6. Net Profit FY25 (post-exceptional) 1,182 Mn +34.3%YoY
  7. EPS Q4 ₹4.02

What they filed

Q1 FY27: revenue up 22.5%, net profit up 76.0% against the same quarter last year.

₹ Cr · quarterly
Line itemQ2 FY25Q3 FY25Q4 FY25Q1 FY26Q2 FY26Q3 FY26Q4 FY26Q1 FY27
Revenue652 619 610 612 625 −4%623 +1%613 +0%750 +23%
EBITDA18 26 39 43 55 +206%54 +108%40 +3%75 +74%
Net profit12 12 26 25 37 +208%30 +150%26 +0%44 +76%
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.

Order book

low confidence
Volumes were largely steady or flat compared to the previous quarter but decreased slightly year-on-year, reflecting lower volumes for the 12 months ended December 2025 compared to 2024.

Source: Prepared remarks

Capital allocation

high confidence
  • Debt Gross ₹1,000 Mn Maturity: Balance of ECB scheduled to be paid in June 2027
    • Repayment First tranche of ECB prepaid in September 2025, originally due December 2025.
    Regarding the debt and liquidity position, the ratio remains stable with the external commercial borrowings or ECB of INR1 billion being the only debt we have on the books.
  • Liquidity Cash ₹4,800 Mn Surplus cash deployed into bank deposits and mutual funds, generating an average yield exceeding 6% during the year. Liquidity continues to be strong with substantial unutilized credit lines.
    Surplus cash was deployed into bank deposits and mutual funds, generating an average yield which exceeded 6% during the year. ... Okay. So the total balance is close to INR480 crores or INR4,800 million, right? That's right.

Guidance & targets

Safety

  • Accident-free sites Safety · Ongoing · High confidence 0 accidents
    We will continue to work more on that, and our aim is to have 0 accidents in all our sites.

    — Kamal Taneja

Other

  • Renewable electricity project commissioning Other · Q2 CY26 · High confidence Energy generation
    We have a renewable electricity project undergoing at the moment, which is progressing steadily, and we hope that we have the energy generation from this project in the second quarter of this year.

    — Kamal Taneja

Capacity

  • Capacity utilization Capacity · Next few years · High confidence Okay for next few years
    As you know, we also did optimization exercise a couple of years ago, and we are pretty certain that for the next few years, we'll be okay in terms of capacity utilization.

    — Kamal Taneja

Profitability

  • Profitable growth Profitability · Future · High confidence Focus on profitable growth
    Number one is profitable growth. Number two is capital discipline. So it's good to grow, but we have to also have to make sure that we are disciplined in how and where we spend the money. And very third thing which I have been working on in the last few months that I have been associated with the company is on the accountability, which is how do we take the ownership of what we do, etcetera.

    — Kamal Taneja

Dividend

  • Dividend policy Dividend · Ongoing · Medium confidence Continue good dividends
    I feel we do pretty good dividends over the years. And actually, every time we have something special, we actually do a better dividend than previously. And we will continue doing that.

    — Kamal Taneja

What to watch in Q4 FY26

Renewable Electricity Project Commissioning

Q2 CY26
Current Under progress
Target Energy generation commenced

Why it matters

Indicates progress on sustainability goals and potential cost savings, contributing to operational efficiency.

We have a renewable electricity project undergoing at the moment, which is progressing steadily, and we hope that we have the energy generation from this project in the second quarter of this year.

Risks & concerns

  • Stagnant Volume Growth

    medium

    Volumes decreased slightly YoY for Q4 and FY25, and have shown no growth for several years, posing a challenge for top-line expansion.

    Analyst acknowledged

  • High Charges from Parent Company

    medium

    Significant IT and centralized service charges (e.g., INR 80 crores in FY24) paid to the parent impact minority shareholder profitability, raising concerns about value for money.

    Analyst acknowledged

  • Regulatory Environment and Customer Adaptation for New Products

    low

    Slow adaptation by customers and less strict regulations have hindered the growth of sustainable products like Blueloop, despite their potential.

    Management acknowledged

  • Senior Leadership Turnover

    low

    Recent exits of the CEO, CFO, and Sales Head raise questions about stability, though management asserts the company's strong foundation will ensure continued performance.

    Analyst downplayed

Q&A highlights

5 direct, 1 evasive
Capacity Utilization and Volume Growth Direct
I think, I can tell you definitely a couple of things that we have done recently when I talked about operational efficiency, obviously, when you are more efficient, you make more room for growth. So that plus inherent capacity we have in the system means that we have enough room to grow.

Addresses investor concern about stagnant volume growth and the company's ability to grow with existing capacity, attributing future growth to operational efficiency.

Asked by Ritesh Poladia

Sustainability of Margins and Top-line Growth Direct
I think what I can say is because I personally worked on this last year, we made changes to the way we work, both in the factories and in our go-to-customer strategies, which are not onetime. These are sustainable.

Clarifies that margin improvements are due to sustainable operational changes, not one-offs, and addresses the company's approach to top-line growth.

Asked by Rajakumar V. Nathan

US-India Trade Deal Impact Direct
our pie of that our total impact is only 1% of our sales. So if we say our INR2,400 crores top line, only 1% of that business is through U.S. We hope we can increase it with this trade deal, but we'll see how it goes. But I think for us, it's a very small impact, if I can say that.

Quantifies the minimal current impact of the US-India trade deal on the company's sales, managing expectations for investors.

Asked by Rajakumar V. Nathan

ECB Repayment Schedule Partial
No, I thought the annual report mentioned it was scheduled to be repaid in February of 2026. So that -- there is some confusion probably. ... Q3 2024 is when it was supposed to be. ... Okay. Vipul, why don't I check that?

Highlights a discrepancy between the analyst's understanding from the annual report and management's current information regarding a significant debt repayment, indicating potential lack of clarity or miscommunication.

Asked by Vipul Shah

High IT Charges from Parent Company Direct
I would appreciate you putting your hands on that as well and probably negotiate with the parent, because ultimately, time and again, this will come up for the minority shareholders as well. ... I think a lot of times, we actually underplay how much important these charges and these help support that we have.

Acknowledges a significant concern for minority shareholders regarding substantial IT charges paid to the parent, which impacts profitability, and management's initial stance on its value.

Asked by Vipul Shah

Market Share Evasive
So that's a very complicated question. So I wish I had a clear answer. As you know, Mehul, we work in a very fragmented market, right? ... So frankly speaking, it would be very difficult for me to actually tell you what our market increase or decrease in future.

Management's inability to quantify market share due to market fragmentation indicates a challenge in assessing competitive position and growth.

Asked by Mehul

Senior Leadership Changes Direct
I don't think there's like a systematic approach on changing CEO, CFO, Etc. I think these are one thing I know is if that didn't change, I won't be here on the call today. So that's a good thing. So I'm not complaining about that. ... I do not think it makes a huge difference on how we perform in the market.

Addresses recent high-level exits (CEO, CFO, Sales Head) but downplays their impact on company performance, which could be a point of concern for investors.

Asked by Rajakumar V. Nathan

External Environment for Volume/Revenue Growth
I aspire for many things, Sheetal. I want our customers to double their volume, double their profit, etcetera, etcetera. I think, again, you know it's a joke. But I think I hope this growth that we are seeing in the industry grows. ... But sir, that has not happened since last 4, 5 years. Do you expect it to happen in the coming future, sir? Like I said, I just hope, right? I do not know.

Highlights the long-standing issue of stagnant volume growth and management's lack of concrete plans or expectations for a turnaround, despite aspirations.

Asked by Shital Shah

3 min read 7 chapters

Detailed narrative

Financial Performance Overview

Huhtamaki India reported Q4 CY25 net sales of INR 6 billion, remaining flat compared to the previous quarter and year-on-year. For the full year 2025, net sales were INR 23.9 billion, a 2.5% decline from INR 24.5 billion in 2024. Despite lower volumes, the company achieved a significantly higher profit before tax (PBT) of INR 410 million in Q4, up 169.7% YoY from INR 152 million in Q4 2024. Full-year 2025 PBT (before exceptional items) grew 83% to INR 1.57 billion, and net profit after tax reached INR 1.182 billion, up 34.3% from INR 880 million in 2024.

Strategic Focus and Operational Efficiency

The company's strategic decisions focused on optimizing product and customer mix, leading to improved operational efficiencies and cost structure. Management highlighted that the long-term strategy for world-class operations is paying off, with real improvements across sites, including better efficiency, reduced waste, and tighter control of overheads. The company's core priorities for future growth are profitable growth, capital discipline, and accountability, aiming to build high-quality business and refine its product and customer portfolio.

Sustainability Initiatives

Huhtamaki India made significant progress in sustainability, achieving approximately 50% reduction in recordable incidents and lost time injuries. The company also reported 0 liquid discharge at its Khopoli, Rudrapur, and Silvassa sites, demonstrating a commitment to sustainable water practices. A renewable electricity project is underway, expected to generate energy in Q2 CY26, and solvent consumption was reduced across all sites in Q4 2025, improving worker environment and reducing emissions.

Capacity Utilization and Volume Growth Challenges

While the company has sufficient inherent capacity and has optimized operations to make room for growth, volumes remained largely steady quarter-on-quarter but decreased slightly year-on-year for both Q4 and FY25. Management acknowledged that volume growth has been stagnant for several years, and while they aspire for customer volume and profit to double, they lack concrete expectations for a near-term turnaround in top-line growth, indicating a focus on profitable growth over sheer volume.

Product Innovation and Blueloop

The company continues to introduce new products, often supported by global expertise from overseas. Blueloop, a sustainable and recyclable product, is considered a game-changer. However, its growth has been slower than expected due to slow customer adaptation and less stringent regulations, with customers delaying trials. Despite these challenges, the company remains hopeful for its long-term success, with asset utilization currently around 25-30%.

Charges from Parent Company

Analysts raised concerns about significant charges paid to the parent company for IT and centralized services, citing INR 80 crores in FY24 as a substantial amount impacting minority shareholder profitability. Management defended these charges as essential for supporting operations and leveraging global resources, arguing they provide value and economy of scale. However, they also acknowledged the analyst's request for negotiation and review of these costs.

Leadership Changes and Future Outlook

Recent senior leadership changes, including the exits of the CEO, CFO, and Sales Head, were noted by analysts. Management stated that these changes were not part of a systematic approach and emphasized that the company's strong foundation and principles would ensure continued performance. The new Managing Director, Kamal Taneja, expressed commitment to building on the strong foundation and leading Huhtamaki India into its next phase of growth, focusing on profitable growth, capital discipline, and accountability.

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