Tinna Rubber and Infrastructure Limited

Tinna Rubber reported a stable Q1 FY26 revenue Q-o-Q, though it saw a 4% decline Y-o-Y, primarily due to a lower EPR contribution of INR4 crores compared to INR10.5 crores in Q1 FY25. Despite this, the company achieved a 19% Q-o-Q increase in EBITDA to INR21 crores, with the EBITDA margin strengthening to 16%, an improvement of 237 basis points Q-o-Q. Gross margins also saw a significant improvement of approximately 344 basis points Q-o-Q, driven by lower raw material costs and enhanced operational efficiency.

The company successfully completed its maiden Qualified Institutional Placement (QIP) in July 2025, raising approximately INR79 crores from marquee institutional investors. These funds are strategically allocated: INR23 crores for debt reduction, INR12 crores for solar power expansion, INR22 crores for a new recovered carbon black (RCB) plant, and INR19 crores for general corporate purposes. This deployment is expected to commence from Q2 FY26, with debt reduction projected to yield annual interest savings of INR1.5 crores.

Tinna Rubber is expanding its renewable energy capacity more than threefold, from 1.26 MW to 4.52 MW, aiming to meet approximately 50% of its power needs through renewable sources and save INR3 crores annually. The company is also increasing its optionality in using different types of tires as feedstock, which is expected to result in cost savings of 10% to 15%. Additionally, INR5.6 crores from non-core assets have been monetized in Q1 FY26, with further monetization efforts ongoing.

In Q1 FY26, the Industrial and Steel segments delivered revenue growth of 15% and 8% Y-o-Y, respectively. However, the Infrastructure and Consumer segments experienced a temporary slowdown due to delayed fund releases and early monsoon. The Varale plant significantly increased its capacity utilization from 30% in Q1 FY25 to 57% in Q1 FY26, boosting sales from INR6 crores to INR27 crores. The Polymer Composite Masterbatches (PCMB) business reached sales of 100 tons per month, with an expected contribution of INR30-35 crores to the top line in FY26.

International operations saw the Oman plant operating at 85% capacity utilization, generating around $1 million in revenue, with 35% of its output sold within the GCC region. In Saudi Arabia, the company secured 20,000 square meters of land for a new facility, with commissioning anticipated from Q4 2026. Tinna also infused capital into its joint venture, Mbodla Investments in South Africa, which has secured consent to receive and export 24,000 tons of end-of-life tires for use as feedstock in Indian and Omani plants, with Phase 1 operations commencing in Q1 FY26.

The company remains on track for its Vision 2028, aiming to expand its presence from 6 to 10 locations and achieve a revenue CAGR of 25% to reach INR1,000 crores by FY28. It targets an EBITDA margin of 18% plus and ROCE exceeding 30%. For FY26, the company maintains its guidance of over INR600 crores in revenue and an EBITDA margin of 15% plus, anticipating a strong rebound in infrastructure and consumer segments post-monsoon.