India Glycols Limited — Q1 FY26 earnings call

Call held 11 Aug 2025

Management summary

India Glycols delivered a strong Q1 FY26, primarily driven by robust performance in its Bio-Fuel and Potable Spirits segments, which saw significant revenue and profit growth. Overall margins expanded, despite some pressures in the Chemicals and Ennature Biopharma segments. The company is also advancing its demerger plans and strategic partnerships, focusing on premiumization and market expansion, while maintaining a conservative CapEx and debt reduction strategy.

Highlights

  • Net revenue increased 7% YoY to ₹1,040 crores.

  • EBITDA grew 18% YoY to ₹151 crores.

  • PAT grew 21% YoY to ₹73 crores.

  • EBITDA margins expanded by 128 basis points to 17.7%.

  • Potable Spirits revenue surged 22% to ₹342 crores, with EBIT margins improving from 17.5% to 21.1%.

  • Bio-Fuel's top line was up 45% to ₹348 crores.

  • Joint venture profit increased 73.7% YoY to ₹19 crores.

  • The company expects to achieve 20% ethanol blending in '25-'26, ahead of the original 2030 target.

Key financials

  1. Net Revenue ₹1,040 Cr +7%YoY
  2. Gross Revenue ₹2,503 Cr +10%YoY
  3. EBITDA ₹151 Cr +18%YoY
  4. PAT ₹73 Cr +21%YoY
  5. EBITDA Margin 17.7%
  6. EPS ₹23.7 +21%YoY

What they filed

Q1 FY27: revenue up 8.7%, net profit up 32.9% against the same quarter last year.

₹ Cr · quarterly
Line itemQ2 FY25Q3 FY25Q4 FY25Q1 FY26Q2 FY26Q3 FY26Q4 FY26Q1 FY27
Revenue961 975 863 1,040 1,092 +14%1,102 +13%976 +13%1,130 +9%
EBITDA116 124 146 150 158 +36%175 +41%166 +14%170 +13%
Net profit50 57 64 73 65 +30%68 +19%87 +36%97 +33%
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.

Segment breakdown

SegmentRevenueEBIT Margin
Bio-Fuel₹348 Cr6.5%
Potable Spirits₹342 Cr21.1%
Chemicals (BSPC)₹300 Cr10.9%
Ennature Biopharma₹51 Cr—
Joint Venture——

Guidance & targets

Capex

  • Annual CapEx Capex · Current year · High confidence ₹40-50 crores
    So, hopefully, the current year CapEx will be the rollover CapEx, which are coming from last year or maybe maintenance CapEx, which will be about Rs. 40 crores to Rs. 50 crores per year.

    — Anand Singhal, CFO

Debt

  • Loan Repayment Debt · Current year · High confidence ₹300 crores
    Current year, the repayment will be about Rs. 300 crores.

    — Anand Singhal, CFO

Ethanol Blending

  • Blending Target Achievement Ethanol Blending · '25-'26 · High confidence 20%

    Previously 20% by 2030 → 20%

    And if you look at how the blending has gone up in the country from something like 5% in '19-'20, to 10% in 2021, to 10% in '21-'22, there was a hiccup, to 12% in '22-'23, to 15% in '23-'24, to 19% in '24-'25, and we are expecting to do 20% in '25-'26, which, mind you, is ahead of the original plan of delivering this by 2030.

    — Rupark Sarswat, CEO

  • Enhanced Blending Target Ethanol Blending · by 2030 · Medium confidence 25-30%
    An empowered set of personnel from ministry, along with NITI Aayog, are looking at enhancing the blending to anywhere between 25% to 30% by 2030.

    — Rupark Sarswat, CEO

Performance Chemicals

  • Volume Value Contribution Growth Performance Chemicals · foreseeable future · Medium confidence in excess of 150%
    Broadly speaking, we are looking at significant, kind of ballpark I am saying, so keep that in mind, in excess of 150% volume value contribution growth in that small segment.

    — Rupark Sarswat, CEO

Liquor Business

  • Country Liquor Growth Liquor Business · every year on year · High confidence 7-12%
    So, because of this, our growth every year on year, is approximately 7% to 12% growth we are getting.

    — S.K. Shukla, Head Liquor Business

Nutraceuticals

  • Margin Increase Nutraceuticals · from third quarter · Medium confidence substantially
    But from the third quarter, we are having a certain planning to introduce our branded nutraceuticals in U.S. market and in European countries directly on our own. So, at that time, the margin could increase substantially as it looks to us.

    — Manish Pant

Risks & concerns

  • Margin pressure in Ennature Biopharma

    medium

    Due to increased feedstock cultivation, new entrants, slowing demand in developed markets, and competition from China.

    Both acknowledged

  • Fluctuating margins in Bio-Fuel segment

    low

    Margins fluctuate, but regulatory bodies ensure steady decent margins through administrative price mechanisms and feedstock availability.

    Management acknowledged but manageable

  • Raw material price volatility (Crude-based MEG)

    low

    Lower crude prices lead to lower crude-based MEG prices, potentially pressuring green MEG if the price gap remains high, though green MEG is expected to see double-digit growth long-term.

    Management acknowledged but manageable

  • Impact of new state policies on Liquor business

    low

    New policies in UP and Uttarakhand led to temporary trade stocking/destocking, causing sluggish growth in Q1, but stabilization and growth are expected in subsequent quarters.

    Management acknowledged but temporary

Areas of evasion (1)

  • The specific reasons for the QoQ profit degrowth in Liquor were attributed to a mix shift and temporary policy impacts, but a detailed breakdown or quantification was not provided, requiring internal checks by the CFO.

Q&A highlights

2 direct
Liquor Segment Profitability vs. Sales Growth Partial
Anand Singhal: 'In some cases, there are so many brands which my marketing division is selling in the market. And every product does not have the same kind of EBIT margin. So, I have to check internally, but there may be some of the sales which is having a slightly lesser margin as compared to the other products.' Raju Vaziraney: 'See, there were two changes that have happened in our heartland of UP and Uttarakhand, both the states underwent new policies which start from April. So, April and May, I mean, end of last year, that is from 31st March there was a lot of lifting and a lot of dumping of stocks naturally by the trade because they were not sure about the new policy.

The analyst questioned the decline in net profit (7.75%) despite strong sales growth (20.42%) in the liquor segment QoQ, challenging the operating leverage. Management cited product mix shift and temporary trade stocking due to new state policies as reasons, but the explanation for the margin drop was not fully conclusive.

Asked by Jaswinder Singh

Ennature Biopharma Margin Squeeze and Strategy Direct
Rupark Sarswat: 'There are a couple of pressures. I am not going to elaborate on the exact impact of all. One pressure is to do with if there is increased cultivation of the feedstock and there are more new entrants, that puts pressure on margins... And when there are a lot of new entrants and there are alternatives to these natural muscle relaxants, which come from countries like China, which have also flooded the market.' Manish Pant: 'From the third quarter, we are having a certain planning to introduce our branded nutraceuticals in U.S. market and in European countries directly on our own. So, at that time, the margin could increase substantially as it looks to us.

The analyst highlighted a drastic drop in Ennature Biopharma's net margin from 33% in 2021 to 2.38% in Q1 FY26, prompting management to acknowledge margin pressures from feedstock, new entrants, and competition, while outlining a strategy for differentiation and direct market entry for branded nutraceuticals in developed markets from Q3 FY26 to improve margins.

Asked by Jaswinder Singh

Joint Venture Performance and Sustainability Direct
Rupark Sarswat: 'One is that we had faced a challenge where the cost differential between Reliance's and IGL EO had gone up to as high as 42% in around mid of '23, July, August. Now, that really came down to close to 12% to 14% in the quarter... The second thing, as I mentioned, it also improved trading... The third factor has been the enhancement of the product mix within what is manufactured in Kashipur...

The analyst sought clarity on the significant improvement in JV performance (profit up 73.7% YoY) and its sustainability. Management provided specific, fundamental reasons for the improvement, including a reduced EO price gap, enhanced trading, and improved product mix, suggesting that the positive trend is likely to continue.

Asked by Saket Kapoor

3 min read 6 chapters

Detailed narrative

Strong Q1 FY26 Performance Driven by Bio-Fuel and Potable Spirits

India Glycols reported a robust Q1 FY26 with net revenue increasing 7% YoY to ₹1,040 crores, and gross revenue up 10% to ₹2,503 crores. Profitability saw significant improvement, with EBITDA growing 18% to ₹151 crores and PAT up 21% to ₹73 crores. This led to an EBITDA margin expansion of 128 basis points to 17.7% and PAT margin expansion of 80 basis points to 7.0%. The Bio-Fuel segment's top line surged 45% to ₹348 crores, while Potable Spirits revenue grew 22% to ₹342 crores, with its EBIT margins improving from 17.5% to 21.1%.

Strategic Focus on Premiumization and Market Expansion in Potable Spirits

The Potable Spirits business continues its strong performance, with Country Liquor's flagship brand, Bunty Bubli, maintaining its position as the highest-selling liquor brand in India for three consecutive years, holding 24-25% market share in UP. The company is strategically expanding its premium portfolio through the Amrut partnership, adding brands like Prestige Whiskey and achieving over 10% market share for Maqintosh White and Black Labels within a year of launch. IGL also plans to enter new states like Kerala and 2-3 more in the current fiscal, alongside targeting the CSD channel.

Ethanol Blending Program Ahead of Schedule

India Glycols expressed satisfaction with the government's Bio-Fuel strategy, noting that the 20% ethanol blending target, originally set for 2030, is now expected to be achieved by '25-'26. The company reported blending rates progressing from 5% in '19-'20 to 19% in '24-'25. Management believes the business will continue to grow due to increased consumption, penetration, and potential for an enhanced blending mandate of 25-30% by 2030, supported by a well-thought-through administrative price mechanism for feedstocks.

Joint Venture's Profitability Rebound

The joint venture demonstrated strong sales growth and excellent profit numbers, with its contribution to profit increasing 73.7% YoY to ₹19 crores from ₹11 crores. This turnaround is attributed to a significant reduction in the Ethylene Oxide (EO) price gap between Reliance and IGL, which narrowed from 42% in mid-'23 to 12-14% in Q1 FY26. Additionally, improved trading of Clariant's manufactured products through the JV and an enhanced product mix from Kashipur contributed to better margins and sales growth.

Challenges and Strategic Adjustments in Ennature Biopharma

The Ennature Biopharma segment faced pressures, with sales being weak and margins under pressure, dropping to 2.38% from 33% in 2021. Management attributed this to increased feedstock cultivation, new market entrants, slowing demand in developed markets for molecules like thiocolchicoside, and competition from China. The strategic response involves differentiation through impurity profiling, securing regulatory approvals for developed markets (US, Europe, Japan), and a plan to introduce branded nutraceuticals directly in these markets from Q3 FY26 to substantially improve margins.

Controlled CapEx and Debt Reduction Strategy

For the current fiscal year, India Glycols plans a conservative CapEx of approximately ₹40-50 crores, primarily for rollover and maintenance, with no plans for significant new investments. The company aims to consolidate its financial position, with current year loan repayments projected at about ₹300 crores, which will be funded entirely through internal cash accruals. This strategy is expected to reduce the overall debt, with only ₹100-150 crores of debt remaining after these repayments.

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