Pondy Oxides & Chemicals Limited — Q3 FY26 earnings call

Call held 29 Jan 2026

Management summary

Pondy Oxides delivered its strongest ever quarterly and 9-month performance in Q3 FY26, driven by robust revenue and profit growth, and significant capacity expansions in both lead and copper. The company is strategically positioned to benefit from regulatory support and trade deals, with plans for further growth and operational efficiency. However, commodity price volatility led to a mark-to-market provision and some margin pressure in the copper segment.

Highlights

  • Revenue for Q3 FY26 increased to INR 776 crores, up 22% QoQ and 55% YoY, reflecting strong operational efficiency.

  • EBITDA for Q3 FY26 increased by 122% YoY to INR 59 crores, and PAT rose by 148% YoY to INR 38 crores.

  • On a 9-month basis, revenue, EBITDA, and PAT grew 33%, 96%, and 114% YoY respectively, driven by production and sales volumes.

  • Lead capacity expanded by over 50% to 204,000 MTPA with the commissioning of 36,000 MTPA in December 2025.

  • Copper recycling capacity is set to double from 6,000 MTPA to 12,000 MTPA by the end of January 2026.

  • EBITDA per ton of lead increased significantly by 46% YoY to INR 18,086 on a 9-month basis.

Concerns

  • A mark-to-market provision of INR 7.28 crores was recorded due to significant copper price volatility and hedging differences.

  • The plastics segment experienced low capacity utilization of 31% due to shifting premises and soft market demand.

  • Copper EBITDA per ton saw a slight drop in Q3 due to extreme price volatility and challenges in passing on price increases to consumers.

Key financials

2 periods

Q3 FY26

  • Revenue
    ₹776 Cr
    YoY +55% QoQ +22%
  • EBITDA
    ₹59 Cr
    YoY +122%
  • PAT
    ₹38 Cr
    YoY +148%

9M FY26

  • Revenue
    ₹2,007 Cr
    YoY +33%
  • EBITDA
    ₹157 Cr
    YoY +96%
  • PAT
    ₹101 Cr
    YoY +114%

What they filed

Q1 FY27: revenue up 56.2%, net profit up 28.6% against the same quarter last year.

₹ Cr · quarterly
Line itemQ2 FY25Q3 FY25Q4 FY25Q1 FY26Q2 FY26Q3 FY26Q4 FY26Q1 FY27
Revenue572 502 517 596 635 +11%776 +55%932 +80%931 +56%
EBITDA29 25 27 41 54 +86%58 +132%59 +119%55 +34%
Net profit17 15 18 28 36 +112%38 +153%38 +111%36 +29%
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

Share of EBITDA per ton (Q3 FY26)
₹52,752 Total
  • Copper ₹35,325 67.0%
  • Lead ₹17,427 33.0%

Capital allocation

high confidence
  • Capex ₹60 Cr
    • Capacity expansion (Lead and Copper)
    During 9 months FY '26, POCL invested around INR 25 crores in capital expenditure and expects to deploy additional INR 35 crores in the last quarter of FY '26.
  • M&A POCL Future Tech Merger · Announced

    Strengthens vertical integration in plastic recycling, improves cost efficiency and cash flow management, creates long-term value without equity dilution or cash outflow.

    POCL's Board has approved the amalgamation of its wholly-owned subsidiary, POCL Future Tech into the parent company, subject to regulatory approvals.
  • Liquidity Cash ₹35 Cr
    Understood. Also, Vijay, sir, what's the cash on the books as on December end? It's about INR 35 crores.

Guidance & targets

Margin

  • Blended EBITDA Margin Margin · ongoing · High confidence 7% to 8%
    We have always guided our margins to be in the range of 7% to 8% EBITDA, and these will continue as copper increases, we are increasing the copper capacity as well, which is currently at a lower EBITDA range, but we'll also be adding on products on copper, as explained in our earlier calls, which will also have a higher margin. So the blended margins will remain in the range of 7% to 8%.

    — Ashish Bansal

Capacity Utilization

  • Lead Capacity Utilization Capacity Utilization · coming quarters · High confidence 70%
    The lead capacities are expected to ramp up to 70% in the coming quarters.

    — Ashish Bansal

Capacity

  • Copper Recycling Capacity Capacity · Jan 2026 · High confidence 12,000 MTPA

    From 6,000 MTPA today

    Our copper recycling capacity is set to double from 6,000 metric tons per annum to 12,000 metric tons per annum by the end of Jan 2026.

    — Ashish Bansal

Production Volume

  • Copper Production Production Volume · FY27 · High confidence minimum 12,000 metric tons
    FY '27, we are targeting a minimum of 12,000 metric tons but would be definitely higher than that.

    — Ashish Bansal

Expansion

  • Mundra Expansion Implementation Expansion · CY27 H2 · High confidence second half of calendar year 2027
    I'm referring to second half of calendar year 2027.

    — Ashish Bansal

Profitability

  • Lead EBITDA per ton Profitability · sustainable · High confidence INR 15,000 to INR 17,500
    INR 15,000 to INR 17,500 is something what we have -- it's a sustainable EBITDA per ton irrespective of the price movement.

    — Vijay Balakrishnan

  • Copper EBITDA per ton Profitability · sustainable · High confidence INR 35,000 to INR 40,000
    In terms of EBITDA per ton irrespective of prices, we still maintain at INR 35,000 to INR 40,000. This is what we have maintained.

    — Vijay Balakrishnan

  • EBITDA Margins Profitability · long-term · High confidence above 8%
    focus on maintaining EBITDA margins above 8%

    — Ashish Bansal

  • ROCE Profitability · long-term · High confidence above 20%
    ROCE above 20%.

    — Ashish Bansal

Product Mix

  • Value-added Products Contribution Product Mix · long-term · High confidence over 60%
    the company's long-term target of achieving over 60% contribution from value-added products.

    — Ashish Bansal

Efficiency

  • Energy Consumption Reduction Efficiency · long-term · High confidence 20% plus
    20% plus reduction in energy consumption

    — Ashish Bansal

Volume

  • Volume Growth Volume · long-term · High confidence 20% plus
    delivering 20% plus volume growth

    — Ashish Bansal

Financial Growth

  • Revenue and Profitability CAGR Financial Growth · long-term · High confidence 20% plus
    20% plus CAGR in revenue and profitability.

    — Ashish Bansal

Inventory

  • Inventory Value Inventory · by year-end · High confidence INR 230 crores to INR 250 crores
    And as for inventory, INR 230 crores to INR 250 crores will be a number which we can expect in the -- by year-end.

    — Vijay Balakrishnan

What to watch in Q4 FY26

Lead Capacity Utilization Ramp-up

coming quarters
Current 79.2% (Q3 FY26)
Target 70% for new capacity

Why it matters

Monitoring the ramp-up of new lead capacity is crucial for assessing the realization of expansion benefits and overall volume growth.

The lead capacities are expected to ramp up to 70% in the coming quarters.

Risks & concerns

  • Copper Price Volatility

    high

    Extreme volatility in copper prices led to a slight margin shrink and mark-to-market provisions, as price increases are difficult to pass on immediately to consumers.

    Management acknowledged

  • Soft Demand in Plastics Segment

    medium

    The plastics segment experienced soft market demand and softer primary material prices, leading to lower capacity utilization.

    Management acknowledged

  • Domestic Sourcing Costs

    low

    Domestic prices for scrap can increase when supply is lean, and the company's preference for sourcing from the formal sector can lead to higher costs.

    Management acknowledged

Q&A highlights

7 direct
Copper EBITDA margin guidance given increased capacity Direct
We have always guided our margins to be in the range of 7% to 8% EBITDA, and these will continue as copper increases, we are increasing the copper capacity as well, which is currently at a lower EBITDA range, but we'll also be adding on products on copper, as explained in our earlier calls, which will also have a higher margin. So the blended margins will remain in the range of 7% to 8%.

Clarifies how the company plans to maintain overall EBITDA margins despite lower individual copper segment margins, by adding higher-margin copper products.

Asked by Dheeraj Ram

Capacity utilization for lead and copper segments Direct
See, overall, if you see the lead capacity utilization for this 9 months ended is about 70%. And for this quarter alone, it is about 79.2%. For copper for 9 months about 74% and for this quarter, it's about 86.2% on an overall basis for this quarter.

Provides specific capacity utilization rates for both lead and copper, indicating strong operational performance and ramp-up of new capacities.

Asked by Sagar Shah

Performance and demand outlook for the plastics segment Partial
We'll be slowly looking at trying to build those volumes. But currently, what we saw in the last quarter, the whole market demand was pretty much on the softer side, along with softer prices and offtakes as well.

Highlights challenges in the plastics segment, including soft demand and lower capacity utilization, indicating a potential drag on overall performance.

Asked by Sagar Shah

Timeline and strategic plans for Mundra expansion Direct
So Sagar, currently, as indicated earlier as well, we will be looking into Mundra only in 2027. That is now once our copper expansions are completed by this last quarter of 2026 and 2027, and post that, the Mundra land capacity will be seen. Definitely, we'll be looking at the existing businesses that we have and also some fresh business.

Provides a clear timeline for the significant Mundra expansion and outlines the strategic focus on existing businesses and new market access (EU/Middle East).

Asked by Sagar Shah

Impact of mark-to-market provision on profitability and hedging strategy Direct
Yes. We used to hedge our copper. And since already 100% of our copper volumes are hedged. And if you see from the last quarter to this quarter, there's consistently incremental volume. So that mark-to-market difference of the incremental volume is what is reflected back, which is currently a moving position.

Explains the reason behind the INR 7.28 crores mark-to-market provision, linking it to copper hedging and volume increases amidst price volatility.

Asked by Naman Parmar

Reasons for lower lead EBITDA per ton in Q3 Direct
See, there are 2 reasons, definitely, yes, because the value-added product mix was slightly lower, that definitely did bring down a little bit of the margins. Apart from that, we had increased a little bit of our domestic procurement on raw material as we want to slowly start sustaining our domestic procurement footprint where the current domestic prices were a little bit on the sharper side.

Identifies specific factors (lower value-added mix, higher domestic procurement costs) that impacted lead EBITDA per ton, providing insight into margin drivers.

Asked by Mitul Patel

Impact of India-EU trade deal on procurement and selling Direct
Going forward on metal specifically, they have indicated they will make it 0. So that opens up as a very good and competitive market for Indian material to start flowing into EU. And we definitely already have approvals with quite a few of the customers, but it was only opportunistic business when we are able to sell to them. But once these agreements and FTAs are in place, this should turn back into a sustainable long-term business.

Highlights the significant positive impact of the India-EU trade deal, potentially opening new export markets and making Mundra a strategic location for European and Middle Eastern markets.

Asked by Mitul Patel

Company's strategy regarding lithium-ion business Direct
Number two, on lithium-ion, basically, we aren't very sure of 2 things. One, the feedstock availability in the Indian market. And number two, we also expect kind of the technology upgradation, what is happening in lithium-ion is quite fast tracked. And we just wanted to monitor that and understand the technology and the feedstock availability because whatever it mostly comes from the EV and the electronics.

Clarifies the company's cautious stance on lithium-ion, citing concerns about feedstock availability and rapid technological changes, indicating no immediate entry into this segment.

Asked by Nikhil Agarwal

3 min read 5 chapters

Detailed narrative

Strong Financial Performance in Q3 FY26

Pondy Oxides reported its strongest ever quarterly and 9-month performance in Q3 FY26. Revenue for the quarter increased to INR 776 crores, marking a 22% quarter-on-quarter and 55% year-on-year growth. This robust top-line performance translated into significant profit growth, with EBITDA rising 122% year-on-year to INR 59 crores and PAT surging 148% year-on-year to INR 38 crores. For the first nine months of FY26, revenue, EBITDA, and PAT grew 33%, 96%, and 114% respectively, driven by substantial increases in both production and sales volumes across the lead and copper businesses.

Significant Capacity Expansion and Utilization

The company made steady progress on its capacity expansion roadmap, commissioning the second phase of its lead expansion project, adding 36,000 metric tons per annum (MTPA) in December 2025. This increased the total lead capacity to 204,000 MTPA, representing an over 50% increase from FY25 levels, with capacities expected to ramp up to 70% in coming quarters. Copper recycling capacity is also set to double from 6,000 MTPA to 12,000 MTPA by the end of January 2026, with trials ongoing and operationalization expected in February and March 2026. Overall lead capacity utilization for Q3 FY26 was 79.2%, and for copper, it was 86.2%.

Strategic Initiatives and Regulatory Environment

The India-EU trade deal is viewed as a structural catalyst, potentially enhancing POCL's global price competitiveness and opening up the European market with zero duties on metals, making it a sustainable long-term business. Domestically, supportive regulatory environments, including stronger enforcement of BWMR and EPR frameworks, are improving scrap collection and traceability, enabling higher local sourcing. The amalgamation of the wholly-owned subsidiary POCL Future Tech into the parent company aims to strengthen vertical integration in plastic recycling, improve cost efficiency, and create long-term value.

Margin Dynamics and Commodity Volatility

While the company maintained its blended EBITDA margin guidance of 7% to 8%, the copper segment experienced a slight margin shrink in Q3 due to extreme price volatility and challenges in passing on price increases to end consumers. This volatility also led to a mark-to-market provision of INR 7.28 crores related to copper hedging. Lead EBITDA per ton for Q3 was INR 17,427, which was slightly lower than previous quarters due to a reduced value-added product mix (55% in Q3 vs. typical 70%) and higher costs associated with increased domestic raw material procurement.

Capital Expenditure and Future Growth Plans

POCL invested INR 25 crores in capital expenditure during the first nine months of FY26 and plans to deploy an additional INR 35 crores in Q4 FY26, totaling INR 60 crores for the fiscal year, primarily for lead and copper expansions. The company's 'Target 2030' vision focuses on delivering 20% plus volume growth and 20% plus CAGR in revenue and profitability, with a focus on maintaining EBITDA margins above 8% and ROCE above 20%. The significant Mundra land expansion is slated for implementation in the second half of calendar year 2027, targeting existing businesses and new market entries in Europe and the Middle East.

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