Styrenix Performance Materials Limited — Q4 FY25 earnings call

Call held 25 May 2025

Management summary

Styrenix Performance Materials reported a robust Q4 and full year FY25, driven by strong volume growth and the initial positive contribution from the Thailand acquisition. The company outlined ambitious capacity expansion plans for ABS and HIPS in India, aiming to capitalize on growing demand. Despite one-off expenses impacting Q4, management expressed confidence in future growth and operational efficiency, with a focus on optimizing the newly acquired Thailand business.

Highlights

  • Consolidated Revenue for FY25 stood at ₹2,982 crores, with a sales volume of 203 KT.

  • Consolidated PBDIT for FY25 was ₹362 crores (12.2% margin), and PAT was ₹235.1 crores (7.9% margin).

  • Q4 FY25 Consolidated Revenue reached ₹940 crores with a sales volume of 65 KT.

  • Q4 FY25 Consolidated PBDIT was ₹90 crores (9.57% margin), and PAT was ₹56.2 crores (6% margin).

  • Standalone FY25 sales volume increased by 12.8% YoY to 186 KT, with revenue growing 23.5% YoY to ₹2,744 crores.

  • The Thailand acquisition, effective January 17, 2025, contributed 17,000-18,000 tons in sales volume for Q4 FY25 with a positive EBITDA margin of 4.1%.

  • The company plans to add 50,000 tons of ABS capacity by Calendar Year 2026 (FY27) and is studying a 45,000-ton HIPS expansion for FY27.

  • One-off expenses of approximately ₹15 crores were incurred in Q4 FY25, related to name change and the Thailand acquisition.

Key financials

2 periods

Q4 FY25

  • Consolidated Revenue
    ₹940 Cr
  • Consolidated PBDIT Margin
    9.6%
  • Consolidated PAT Margin
    6%
  • Standalone Revenue
    ₹702 Cr
    YoY +17.2% QoQ +1.6%
  • Standalone Sales Volume
    48.3 KT
    YoY +9.5% QoQ +1.7%
  • Thailand EBITDA Margin
    4.1%

FY25

  • Consolidated Revenue
    ₹2,982 Cr
  • Consolidated PBDIT
    ₹362 Cr
  • Consolidated PAT
    ₹235.1 Cr
  • Consolidated Sales Volume
    203 KT
  • Standalone Revenue
    ₹2,744 Cr
    YoY +23.5%
  • Standalone Sales Volume
    186 KT
    YoY +12.8%
  • Standalone PBDIT Margin
    12.9%
    YoY +0.7%
  • Standalone PAT Margin
    8.5%
    YoY +0.8%

What they filed

Q1 FY27: revenue up 6.5%, net profit up 149.1% against the same quarter last year.

₹ Cr · quarterly
Line itemQ2 FY25Q3 FY25Q4 FY25Q1 FY26Q2 FY26Q3 FY26Q4 FY26Q1 FY27
Revenue653 691 702 721 615 −6%648 −6%656 −7%768 +7%
EBITDA99 74 82 84 79 −20%75 +1%124 +51%199 +137%
Net profit70 48 53 55 51 −27%44 −8%84 +58%137 +149%
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.

Guidance & targets

Capacity

  • ABS Production Capacity Capacity · Calendar Year 2026 (FY27) · High confidence 50,000 tons
    In our Chairman's comments, we mentioned about starting 50,000 ton production earlier, and it mentioned 2026 itself. So, does it mean FY '26 or Calendar Year '26? So, Calendar Year '26.

    — Rahul Agrawal, Managing Director

  • Installed Capacity (India, ABS+PS) Capacity · FY25 · High confidence around 200,000 tons roughly
    The total capacity which we believe for this financial year would be to the tune of around 200,000 tons roughly. Yes.

    — Rahul Agrawal, Managing Director

  • Effective Capacity (India) Capacity · FY26 · Medium confidence a little bit more than 200,000 ton (205-210 KT)
    So, essentially even this year, we do believe that our effective capacity will be actually a little bit more than 200,000 ton. Whether it will be 205 or 210 will depend on exactly when we are able to complete these activities in the middle of this year.

    — Rahul Agrawal, Managing Director

  • Additional ABS Capacity (India) Capacity · middle of the next financial year (FY27) · Medium confidence some capacity
    Again, like I mentioned, we do intend to add additional ABS capacity in the middle of the next financial year. So, that will add some capacity for us in the next financial year as well.

    — Rahul Agrawal, Managing Director

  • HIPS Expansion (India) Capacity · Fiscal 27 · Medium confidence 45,000 tons
    Sure. Second was on CAPEX, as Mr. Bhupesh explained, it's sticking to earlier plan, just wanted to know the HIPS expansion. I think about 45,000 tons is something which we are supposed to add. Will that be preponed as well? Like, will that happen in Fiscal '26? And if yes, then just wanted to know the overall CAPEX budget for the company for Fiscal '26 overall and '27, if that is possible. And HIPS will definitely not be part of Fiscal 26, right? Even if we finalize the destinations very soon, the production will start sometime in Fiscal ‘27. Is that correct? Yes. Yes. Let us see what the engineering studies say. I do not want to put the horse before the cart. So let the study come in, and I am in a better position to answer that question.

    — Rahul Agrawal, Managing Director

Volume

  • Volume Growth (India) Volume · FY26 · High confidence 10% over FY25 volumes (185,000 tons)
    Got it. So, if the demand is there, can we grow our volumes by 10% over FY '25 volumes, which is around 185,000 ton? We believe so.

    — Rahul Agrawal, Managing Director

  • Volume Growth (India) Volume · FY26 · Medium confidence higher than 200,000 tons (205 or 210 KT)
    Like I said, I think, we should be able to do growth in line with what capacities would be available to us, and this would be higher than 200,000 tons. Whether it is 205 or 210, I am not exactly sure right now. But to order of that magnitude, we would have growth in volumes in India.

    — Rahul Agrawal, Managing Director

Working Capital

  • Inventory Normalization Working Capital · in a year or so · High confidence normalized
    So yes, the inventories have increased, which will be normalized again in a year or so once our all projects are getting completed.

    — Bhupesh P. Porwal, Chief Financial Officer

CAPEX

  • Overall CAPEX Budget CAPEX · FY26 and FY27 · Low confidence exact numbers pending
    So maybe we can, the things are getting finalized soon, maybe in next fortnight or so, 15 days or so. And then we can definitely let you know exact numbers which we will be spending in this year, and what numbers we will be spending in next year. Yes.

    — Bhupesh P. Porwal, Chief Financial Officer

Pricing

  • ABS and PS Pricing Pricing · current and future · High confidence stable
    In terms of pricing for ABS and PS, currently we believe it is stable. There is no major change from what we have seen in previous years, since we are managing the company. And it is largely expected to remain in line with that.

    — Rahul Agrawal, Managing Director

Risks & concerns

  • Geopolitical events impacting business

    medium

    Management noted that geopolitical events globally do have an impact on their business, though not specific to the Thailand entity in isolation.

    Management acknowledged

  • Increased working capital due to inventory buildup

    medium

    Inventories increased in India due to debottlenecking activities and in Thailand due to running at full throttle to understand assets; management expects normalization within a year.

    Management acknowledged

  • China overcapacity and potential dumping

    medium

    Analysts raised concerns about China's overcapacity leading to dumping. Management stated they differentiate products, benefit from domestic preference, and BIS standards will help limit imports.

    Analyst downplayed

Areas of evasion (2)

  • exact CAPEX numbers for FY26/27 (due to timing)
  • exact export breakup for Thailand (competitive sensitivity)

Q&A highlights

3 direct
Explanation of increased 'Other Expenses' in Q4 FY25 Direct
Essentially, we have had roughly Rs. 11 crores, which can be attributed to certain name change expenses in GIDCs... Also, there has been an additional expense, kind of an extraordinary expense, which is related to acquisition of the Thailand company, which is to the tune of Rs. 4 crores.

Clarified that a significant portion of the increase in 'other expenses' was due to one-off, non-recurring costs related to name change and the Thailand acquisition, providing a clearer picture of underlying operational costs.

Asked by Dhaval Shah

Outlook and profitability of the newly acquired Thailand business Direct
In that time, in terms of overall volumes, it is to the tune of around 17,000, 18,000 tons of sales, which we have done from there... For the Thailand company, the EBITDA has been 4.1% for this quarter. And I think from last, since we have taken over, this is the first quarter and it is a positive one, and earlier all quarters have been in red, in fact.

Provided initial performance metrics for the Thailand subsidiary, including sales volume and a positive EBITDA margin, indicating a successful initial integration and a turnaround from previous losses.

Asked by Kalash Jain

Impact of China's overcapacity and potential dumping on Indian markets Direct
China is already producing far more than it actually needs even today... I do believe in Thailand as well, we have some very differentiated technologies... in India, there is a preference for domestic manufacturers... there is a BIS on ABS... For polystyrene, currently there is no BIS. But that we do believe would come up in time as well.

Addressed a key sector-wide concern, explaining Styrenix's competitive advantages (differentiated products, domestic preference, upcoming BIS standards) that mitigate the risk of Chinese dumping, offering reassurance to investors.

Asked by Radha

2 min read 6 chapters

Detailed narrative

Q4 FY25 and Full Year FY25 Financial Performance

Styrenix Performance Materials reported a strong Q4 FY25, with consolidated revenue reaching ₹940 crores on a sales volume of 65 KT. Consolidated PBDIT stood at ₹90 crores (9.57% margin), and PAT was ₹56.2 crores (6% margin). For the full year FY25, consolidated revenue was ₹2,982 crores with a sales volume of 203 KT. The company achieved a consolidated PBDIT of ₹362 crores (12.2% margin) and PAT of ₹235.1 crores (7.9% margin), reflecting robust performance.

Initial Performance and Outlook for Thailand Acquisition

The acquisition of Styrenix Performance Materials (Thailand) Limited, effective January 17, 2025, showed a positive start. For the less than 2.5 months of operation in Q4 FY25, the Thailand entity contributed 17,000-18,000 tons in sales volume and achieved a positive EBITDA margin of 4.1%, a significant improvement from previous quarters which were in red. Management aims to increase capacity utilization from the plant's nameplate capacity of 120,000 tons, which includes rubber, SAN, and compounding.

Capacity Expansion and Volume Growth in India

The company is actively pursuing capacity expansion in India. It plans to add 50,000 tons of ABS production capacity by Calendar Year 2026, with full benefits expected in FY27. Current installed capacity for ABS and polystyrene combined is around 200,000 tons, with effective capacity for FY26 projected to be slightly higher, between 205,000 to 210,000 tons. Additionally, a 45,000-ton HIPS expansion is under study, with production anticipated to start in Fiscal 2027, further augmenting future volume growth.

One-off Expenses and Working Capital Management

Q4 FY25 saw approximately ₹15 crores in one-off expenses. This included ₹11 crores for name change expenses related to GIDC registrations and stamp duty in India, and ₹4 crores for extraordinary expenses tied to the Thailand acquisition. Management clarified these are non-recurring costs. Working capital increased due to inventory buildup for debottlenecking activities in India and running the Thailand plant at full throttle; these inventories are expected to normalize within a year as projects are completed.

Market Dynamics and Competitive Strategy Against China

Analysts raised concerns about China's overcapacity in styrene monomer and its potential impact on downstream product dumping in India. Management acknowledged China's excess production but highlighted Styrenix's strategy of product differentiation, use of specialized technologies (especially in Thailand), and the preference for domestic manufacturers in India. The upcoming BIS standards for polystyrene, similar to existing ones for ABS, are also expected to limit imports and support local players.

Product Mix and SAN Integration Advantages

Styrenix emphasizes the strategic advantage of its backward integration with SAN (Styrene Acrylonitrile), which is both an intermediate for ABS production and an end-use product sold in the market (around 18,000 tons). This integration provides flexibility in producing various ABS grades with tailored chemical resistance and tensile properties. The Thailand facility also offers special SAN grades, which will aid in developing more applications in India and other markets, enhancing product mix and value.

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