Jain Resource Recycling Limited — Q3 FY26 earnings call

Call held 11 Feb 2026

Management summary

Jain Resource Recycling delivered a strong performance in the first nine months of FY26, marked by robust revenue and volume growth, and significant margin expansion. The growth was driven by healthy volumes, disciplined hedging, and improved operating leverage. While the working capital cycle saw a temporary spike, management is confident of normalization. The company is aggressively pursuing four new growth verticals, including high-margin value-added products and international JVs, which are expected to sustain its high-growth trajectory and further improve profitability.

Highlights

  • 9M FY26 Revenue from Operations grew 38% YoY to ₹6,438 crores.

  • 9M FY26 EBITDA increased 65% YoY to ₹449 crores, with margin expanding 116 bps to 7.0%.

  • 9M FY26 PAT grew 65% YoY to ₹281 crores, with margin improving 71 bps to 4.4%.

  • 9M FY26 Volume growth stood at 29.34% YoY.

  • Q3 FY26 EBITDA margin was 7.2% and PAT margin was 4.5%, showing continued improvement.

  • Working capital cycle elongated to 82 days due to a large tender and higher copper mix, with normalization expected in the next quarter.

  • Significant progress reported on four new growth verticals: value-added copper products, Ahmedabad JV, Kuwait JV, and Antimony extraction.

  • Copper EBITDA/tonne for Q3 was ~₹42,000, with management guiding for a stable range of ₹48,000-50,000 in the future.

Concerns

  • Elevated Working Capital Cycle

Key financials

  1. Revenue ₹6,438 Cr +38%YoY
  2. EBITDA ₹449 Cr +65%YoY
  3. EBITDA Margin 7%
  4. PAT ₹281 Cr +65%YoY
  5. PAT Margin 4.4%
  6. Volume Growth 29.3%

What they filed

Q1 FY27: revenue up 70.5%, net profit up 28.1% against the same quarter last year.

₹ Cr · quarterly
Line itemQ2 FY25Q3 FY25Q4 FY25Q1 FY26Q2 FY26Q3 FY26Q4 FY26Q1 FY27
Revenue1,343 1,724 1,639 1,549 2,055 +53%2,676 +55%3,030 +85%2,641 +70%
EBITDA66 76 90 90 156 +136%190 +150%100 +11%106 +18%
Net profit55 42 56 57 99 +80%127 +202%62 +11%73 +28%
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

  • Revenue Mix (9M FY26)
    52% Copper & Copper Alloy43% Lead & Lead Alloy4% Aluminum & Aluminum Products

Guidance & targets

Capacity

  • Copper Anode Production Capacity · February 2026 · High confidence 800 tons/month
    The copper anode phase is expected to commence in February 2026 with an installed capacity of 800 tons per month...

    — Mayank Pareek

  • Copper Cathode Production Capacity · March 2026 · High confidence 750 tons/month
    ...while the copper cathode phase is expected to be commissioned in March 2026 with an installed capacity of 750 tons per month.

    — Mayank Pareek

  • Copper Anode Expansion Capacity · Q1 FY27 · High confidence 1,600 tons/month
    The capacity of the anode section is expected to be doubled to 1,600 tons per month in Q1 financial year 2027.

    — Mayank Pareek

  • Copper Cathode Expansion Capacity · Q3 FY27 · High confidence 1,500 tons/month
    The capacity of the cathode section will also be doubled to 1,500 tons per month by quarter 3 FY27.

    — Mayank Pareek

  • Ahmedabad JV Plant Start Capacity · June 2026 · High confidence Operational
    The plant is expected to be operational in phased manner starting from June 2026...

    — Mayank Pareek

  • Kuwait Battery Recycling Plant Capacity · Q3 FY27 · High confidence 2,000 tons/month
    The project is expected to be up and running in quarter three FY27 with an installed processing capacity of 2,000 tons of battery scrap per month.

    — Mayank Pareek

  • Antimony Extraction Plant Capacity · Q3 FY27 · High confidence 100 tons/month output
    The plant commissioning timeline is quarter three financial year 27. The plant will process 1,000 metric tons of lead-antimony bullion with expected output of approximately 100 tons of antimony per month.

    — Mayank Pareek

Capex

  • Antimony Extraction Plant Capex Capex · FY27 · High confidence around INR 20 crores
    Estimated capex for this project is around INR20 crores.

    — Mayank Pareek

  • Next Financial Year Capex Capex · FY27 · High confidence around INR 110 crores
    Now coming to the next financial year, the total capex including this INR30 crores is going to be in the range of INR100 crores plus INR7 to INR8 crores for Kuwait will be somewhere around INR110 crores.

    — Mayank Pareek

Profitability

  • Copper EBITDA per ton Profitability · coming future · Medium confidence INR 48,000 to 50,000
    So we estimate that this will -- the EBITDA for copper will be there in the range of around 48,000 to 50,000 and this will see stability.

    — Hemant Jain

  • EBITDA Margin Impact from New Projects Profitability · medium term · Medium confidence up to 1% addition
    ...these two projects have potential to add to the EBITDA margin up to 1% for the overall company.

    — Mayank Pareek

Balance Sheet

  • Working Capital Cycle Balance Sheet · next 3 months · High confidence 60-65 days

    Previously 82 days → 60-65 days

    So it will again will come back to around 35 to 40 days. So which will make this working capital cycle better in terms of presently 82 to it will fall to around 60-65 days back.

    — Hemant Jain

Growth

  • Overall Company Growth Growth · future · Medium confidence 40-50%
    I'm very confident -- very, very confident on that about the future growth and we are going to maintain the historical growth of 40%-50%.

    — Kamlesh Jain

Risks & concerns

  • Elevated Working Capital Cycle

    high

    Working capital days spiked to 82, impacting cash flow. Management has a clear plan for normalization within 3 months.

    Analyst acknowledged

  • Commodity Price Volatility Impacting Margins

    medium

    Despite hedging, price volatility causes quarterly fluctuations in EBITDA/tonne due to lags in procurement and sales formulas.

    Analyst acknowledged

  • Project Execution Risk

    medium

    The company has multiple large-scale projects commissioning over the next 18 months. Any delays could impact guided growth.

    Management acknowledged

  • SEBI Investigation Against Promoter

    low

    An ongoing appeal against a SEBI penalty exists. While management terms it a small, old matter, it represents a minor governance overhang.

    Analyst downplayed

Areas of evasion (2)

  • Specific revenue/profit potential of the new antimony project
  • Detailed mechanics of the hedging strategy

Q&A highlights

2 direct
Spike in Working Capital Cycle Direct
This time the working cycle has happened a little longer because one was the New Year... second was the due to the we have taken a very huge tender and that has come... And one more reason is the compared to the lead last year, this time the copper is predominating and copper is the major part of the sale. Copper cycle is not as fast as lead cycle.

It addresses a key balance sheet concern, explaining the operational reasons for the deviation and provides a timeline for normalization.

Asked by Rahul from Lucky Investment Management

Volatility in Copper EBITDA per ton Direct
So there's a ditch gap between the supply and production which will fluctuate the EBITDA, but ultimately on average of the year, it will get maintained or even six months average will get maintained.

This Q&A reveals the underlying business dynamic causing quarterly margin fluctuations despite hedging, which is crucial for investors to understand for modeling profitability.

Asked by Sumant Kumar from Motilal Oswal Financial Services

SEBI Investigation against Promoter Partial
Nothing like this, it's a 10-year old matter and it has been we already file appeal... It is only hardly a 10 lakh matter... No, no, it is three years old matter and it's a small penalty. On a profit of around for INR10 lakh, they have penalized us for INR25 lakhs.

This addresses a significant governance concern. While management downplayed it, the exchange revealed a minor factual inconsistency (10 years vs 3 years) and confirmed an ongoing appeal, which is a key disclosure for investors.

Asked by Chirag from Neo Asset Management

2 min read 5 chapters

Detailed narrative

Stellar 9M FY26 Performance Driven by Volume and Margins

Jain Resource Recycling reported a robust performance for the nine months ending Dec 2025. Revenue grew 38% YoY to ₹6,438 crores, supported by a strong volume growth of 29.34%. Profitability saw a significant uplift, with EBITDA growing 65% to ₹449 crores and PAT also growing 65% to ₹281 crores. This was accompanied by substantial margin expansion, as the EBITDA margin improved by 116 basis points to 7.0% and the PAT margin rose by 71 basis points to 4.4%, reflecting better operating leverage and disciplined execution.

Aggressive Expansion through Four Key Verticals

Management detailed a clear roadmap for future growth centered on four new verticals. The first is a profitability-focused value-added copper project (anodes, cathodes, wire rods) at Jain Green Technologies, with phase-wise commissioning starting Feb 2026. The second is a volume-driven copper recycling JV in Ahmedabad, expected to be operational by June 2026 and add ~₹650 crores to revenue. The third is a JV in Kuwait for battery recycling to secure lead raw material, starting Q3 FY27. The final vertical is a high-margin antimony extraction plant, a new technology for India, with a capex of ₹20 crores and commissioning in Q3 FY27.

Working Capital Spike and Normalization Path

A key point of discussion was the increase in the working capital cycle to 82 days. Management attributed this to three factors: payment delays due to New Year holidays in key export markets like China, a large inventory build-up from a major tender, and a higher mix of copper sales, which has a longer cash conversion cycle than lead. Management expressed high confidence that the cycle will normalize, with inventory levels reducing over the next 1-2 months, and guided for the overall cycle to return to the 60-65 day range.

Copper EBITDA/Tonne Dynamics

Analysts questioned the volatility in copper EBITDA per ton, which was ~₹42,000 in Q3 after being higher in previous quarters. Management explained that while LME prices are hedged, the 'formula' or premium/discount is not, and it fluctuates with price movements. A lag between procurement and sales can cause this quarterly volatility. However, on a 9-month basis, the metric was stable at ₹46,000-47,000 per ton. They guided for a stable range of ₹48,000-50,000 going forward, with a potential to reach ₹70,000-75,000 once the value-added plant is operational.

Capex and Funding Strategy

The company is funding its immediate capex primarily through internal accruals, demonstrating balance sheet discipline. The value-added copper project has a total capex of ~₹95 crores, of which ₹57 crores was spent by Dec 2025. For the next financial year (FY27), the total planned capex is around ₹110 crores, which includes the remaining amount for the copper project and an investment of ₹7-8 crores for the Kuwait JV. This clear capex plan underpins the company's expansion strategy.

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