Tinna Rubber

Tinna Rubber reported strong consolidated financial performance for Q3 FY26, with revenue increasing 13% YoY and 16% QoQ. This growth was primarily driven by higher tire processing volumes. Consolidated EBITDA saw a significant rise of 53% YoY and 57% QoQ, achieving a margin of 16.3%. Similarly, consolidated PAT grew strongly by 53% YoY and 57% QoQ, with a PAT margin of 9.2%. On a nine-month standalone basis, EBITDA margin expanded by 200 bps to 16.8%, and PAT margin by 110 bps to 9.6%.

The company is steadily progressing towards its Vision 2028, aiming for INR 1,000 crores in revenue, over 33% profitability, an EBITDA margin exceeding 18%, and ROCE above 30%. A key strategic update includes securing a two-year work order from Indian Oil Corporation valued at approximately INR 76 crores, bolstering the infrastructure business. The company also allocated INR 5 crores towards R&D to explore adjacencies within its existing business and initiated a life cycle assessment study for GHG emissions, expected to be completed by the financial year-end.

Tinna Rubber completed capital expenditure of approximately INR 79 crores during the nine-month period of FY26, with an additional INR 50 crores planned for the balance of FY26 and FY27. Significant progress has been made in deploying QIP proceeds, with only INR 45 lakh remaining. The pyrolysis and RCB project is on track, with trial runs expected to commence by the end of Q4 FY26. The company aims to increase its tire recycling capacity from the current 185,000 tons to 250,000 tons as part of its Vision 2028.

In line with its ESG goals, Tinna Rubber is significantly scaling up its renewable energy capacity more than threefold, from 1.23 MW to 4.48 MW, with completion targeted by the end of Q4 FY26. This initiative is expected to increase renewable energy's share of total power consumption from 24% to 32% by end FY26 and over 50% by end FY27, projecting savings of approximately INR 4 crores in FY26.

International projects show mixed results. The Oman plant is operating at 80% capacity utilization, generating INR 25 crores in revenue for 9MFY26, with a target to increase GCC region sales from 40% to 70% by Q4 FY26 or Q1 FY27. A 20% reduction in ELT cost is also targeted for Q4 FY26. In Saudi, a 13,000 sq meter plot has been allotted for a 24,000 TPA tire recycling facility, with work expected to commence mid-FY27. The South Africa venture, however, is currently losing money, with break-even anticipated by Q2 FY27.

Management reported stability in raw material prices over the last two quarters, attributing this to increased optionality in the types and origins of end-of-life tires processed. This diversity helps manage fluctuations and maintain gross margins. The company's working capital days are currently around 50, and management expects to maintain this level going forward^⏳, indicating efficient working capital management.

The TP Buildtech segment is expected to show moderate growth this financial year, aiming to finish at par or slightly higher than the previous year's INR 61 crores. The new Kolkata plant, currently in its stabilization phase with 15-20% capacity utilization, is targeted to reach 35-40% utilization within approximately six months. The introduction of new construction chemical product lines, such as grout repair and accelerators, is expected to contribute substantially to the segment's performance in the coming financial year.