Skip to content

    PCBL Chemical Q1 FY26 earnings call

    PCBLGood
    Chemicals·23 Jul 2025
    Management Summary

    PCBL delivered a steady performance in Q1 FY26 despite significant global macroeconomic headwinds and geopolitical uncertainties. The company is successfully transitioning into a multi-chemistry platform, evidenced by volume growth across all segments and a rising share of high-margin specialty products. Management is aggressively expanding capacity in Carbon Black and specialty chemicals like Acetylene Black and Nanovace to capitalize on the 'China+1' strategy and global plant closures in the West.

    Highlights

    8

    • Consolidated Revenue from operations stood at ₹2,114 crores for the quarter.

    • Consolidated EBITDA increased 2.5% QoQ to ₹325 crores, with PAT at ₹94 crores.

    • Carbon Black business achieved 97% capacity utilization with sales volume of 1,54,093 MT.

    • EBITDA per metric ton in the Carbon Black business was reported at ₹17,791.

    • Aquapharm sales volume grew 9% YoY to 26,523 MT, contributing ₹382 crores in revenue.

    • Specialty Carbon Black volume share reached over 10%, up from less than 1% in 2015.

    • Highest ever power generation of 215 MUs, with external sales volume growing 14% YoY to 132 MUs.

    • Management maintained FY26 EBITDA guidance of ₹300+ crores for the Aquapharm business.

    Concerns

    1

    • Russian Dumping in Asia

    Key financials

    Single quarter

    05 metrics
    1. 01Revenue₹2,114 Cr
    2. 02EBITDA₹325 Cr+2.5%QoQ
    3. 03PAT₹94 Cr
    4. 04Carbon Black EBITDA per MT₹17,791
    5. 05Carbon Black Sales Volume1,54,093 MT+2.6%QoQ

    Segment breakdown

    Carbon Black
    91,140 tons Tyre Volume46,888 tons Performance Chemicals Volume16,065 tons Specialty Volume
    Aquapharm
    ₹382 Cr Revenue₹50 Cr EBITDA26,523 MT Sales Volume
    Power
    215 MUs Generation132 MUs External Sales
    List

    Guidance & targets

    5
    CategoryTargetPriority
    Profitability
    Aquapharm EBITDA
    ₹300 crores
    		High
    Capacity
    Total Carbon Black Capacity
    1 million tons
    		High
    Capacity
    Specialty Black Capacity Expansion
    20,000 MTPA
    		High
    Capex
    Annual Maintenance & Growth Capex
    ₹600 crores
    		Medium
    Margin
    EBITDA per kg (Aspiration)
    ₹20-22
    		Medium

    Risks & concerns

    5
    RiskSeverity

    Geopolitical Disruption & Freight Costs

    Red Sea disruptions and trade route issues added ₹6 crores in freight costs to the Aquapharm business this quarter. — Management acknowledged

    medium

    Russian Dumping in Asia

    Sanctions on Russian material have forced them to dump volumes into Asian markets (China/India), creating pricing pressure in spot trades. — Both acknowledged

    high

    U.S. Tariff Uncertainty

    Policy changes and potential tariffs from the U.S. (Trump initiatives) have created confusion and inventory volatility among customers. — Management acknowledged

    medium

    Areas of Evasion(2)

    • Specific guidance on EBITDA per kg for the current year.
    • Exact details on the capacity of Orion's shut-down plants.

    Q&A highlights

    3

    “No. So, the product mix also changed and also there was pressure on pricing, which resulted into lower margins. Additionally, freight costs during the quarter went up because of this trade route disruption.”

    Explains why volume growth in Aquapharm didn't translate to profit growth, citing a ₹6 crore freight impact and pricing pressure.

    asked by Krishan Parwani

    2 min read5 chapters

    Detailed Narrative

    01

    Carbon Black Resilience Amid Global Headwinds

    Despite rising global uncertainties like the Iran-Israel conflict and Red Sea disruptions, PCBL's Carbon Black business achieved a 97% capacity utilization. Sales volume grew 2.6% QoQ to 1,54,093 MT, with domestic sales accounting for 89,606 tons. The company is benefiting from a structural shift in the tyre industry towards cost-efficient hubs like India, especially as Western producers announce plant closures in Europe and North America.

    02

    Strategic Pivot to Specialty and Battery Chemicals

    Specialty Carbon Black now contributes over 10% of total volumes, a significant jump from less than 1% in 2015. PCBL is aggressively expanding into high-performance applications, including a 1,000 MTPA superconductive grade line in Palej and a new 20,000 MTPA specialty line in Mundra. Furthermore, the company has secured a U.S. patent for nanomaterials and is setting up India's first Acetylene Black facility to serve the battery and high-voltage cable markets.

    03

    Aquapharm Integration and Profitability Outlook

    Aquapharm reported a steady volume growth of 9% YoY, reaching 26,523 MT, though EBITDA remained flat at ₹50 crores due to higher freight costs and pricing pressure. Management remains confident in achieving a ₹300 crore EBITDA for FY26, banking on increased capacity utilization and operating leverage in the coming quarters⏳. New capacities for PBTC and green chelates are expected to commission in Q2 FY26 to drive this growth.

    04

    Aggressive Capacity Expansion Roadmap

    PCBL is on track to exceed 1 million tons of capacity by FY28. The first phase of the 30,000 MTPA Brownfield expansion in Tamil Nadu is undergoing trial runs and will commission shortly, followed by another 60,000 MTPA by year-end. Additionally, the company is acquiring 116 acres in Andhra Pradesh for a Greenfield project focused on Rubber Black and Performance Chemicals, expected to be ready in 2.5 to 3 years.

    05

    Power Segment Reaches Record Highs

    The power business achieved its highest-ever generation of 215 MUs this quarter, up 11% YoY. External sales volume grew 14% YoY to 132 MUs, driven by both higher volumes and improved realization of approximately ₹0.50 per unit. This segment contributed an incremental ₹25 crores to EBIT, providing a stable cushion against the more volatile chemical segments.

    This is an AI-generated summary of a publicly available earnings call transcript.