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TruAlt Bioenergy Limited — Q2 FY26 earnings call

Call held 19 Nov 2025

Management summary

TruAlt Bioenergy reported muted Q2 FY26 results with significant revenue declines, primarily attributed to a strategic plant shutdown for dual-feed integration. Despite this, the company highlighted robust growth in its CBG segment and substantial cost savings from transitioning to bagasse-based power. Management emphasized a strategic transformation towards year-round, multi-feed operations and aggressive expansion into CBG, Sustainable Aviation Fuel (SAF), and retail fuel networks, projecting improved profitability and sustained growth in the coming periods.

Highlights

H1 FY26 Revenue from Operations declined 28.55% YoY to INR 418 crores.
Q2 FY26 Revenue from Operations declined 68.07% YoY to INR 129 crores due to strategic plant shutdown.
H1 FY26 Net Loss reduced to INR 33.27 crores from INR 40.25 crores YoY, driven by cost optimization.
CBG segment revenue surged 65.28% YoY to INR 20.71 crores in H1 FY26, with an EBITDA margin of 68.29%.
1,300 KLPD (65% of total) ethanol capacity converted to multi-grain dual-feed for year-round operation.
Target ethanol supply for Nov 2025-Oct 2026 is 47 crores liters.
MOU for INR 2,250 crores SAF plant in Andhra Pradesh, targeting FY28 revenue with a 19% IRR.
Power costs reduced to INR 3.5-4 per liter of ethanol from INR 6-8 per liter by shifting to bagasse.

Concerns

Ethanol Allocation & Oversupply

Key financials

2 periods

Headline

Revenue from Operations
₹418 Cr
YoY -28.5%
Net Loss
₹33.27 Cr

Q2

Revenue from Operations
₹129 Cr
YoY -68.1%
EBITDA
₹-4.55 Cr

What they filed

Q1 FY27: revenue up 106.3%, net profit up 1080.0% against the same quarter last year.

₹ Cr · quarterly

Line item	Q2 FY25	Q3 FY25	Q4 FY25	Q1 FY26	Q2 FY26	Q3 FY26	Q4 FY26	Q1 FY27
Revenue	388	415	907	304	115 −70%	713 +72%	596 −34%	627 +106%
Expenses	371	291	753	262	119	579	466	494
EBITDA	17	125	154	42	-5 −129%	134 +7%	129 −16%	133 +217%
Margin	5%	30%	17%	14%	-4%	19%	22%	21%
Other income	17	15	14	23	15	18	31	15
Interest	34	36	39	38	39	40	44	44
Depreciation	16	18	18	21	21	22	23	25
Profit before tax	-16	86	111	6	-49 −206%	90 +5%	94 −15%	78 +1200%
Tax rate	15%	13%	-1%	18%	-23%	23%	27%	24%
Net profit	-19	75	112	5	-38 −100%	69 −8%	69 −38%	59 +1080%
EPS	-2.64	10.65	15.81	0.67	-4.42	8.08	7.91	6.66

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

Compressed Biogas (CBG)
₹20.71 Cr Revenue (H1)₹10.13 Cr PAT (H1)68.3% EBITDA Margin49.9% PAT Margin (Q2)

Guidance & targets

Capacity Utilization

Overall Capacity Utilization Capacity Utilization · Q3 and Q4 FY26 · High confidence 80%-85%

So in terms of Q3 and Q4, we should be able to operate the capacity that somewhere around 80%-85% above our installed capacity

— Vijay Murugesh Nirani, Managing Director

Profitability

Bottom Line Trend Profitability · Q3 and Q4 FY26 · Medium confidence Improved trend

The improved bottom line compared to the earlier year would mostly be because of the cheaper availability of maize prices in this quarter, in the quarter to come that is Q3 and in the next quarter.

— Vijay Murugesh Nirani, Managing Director

Ethanol Volume

Ethanol Supply Volume Ethanol Volume · November 2025 to October 2026 · High confidence 47 crores liters

We can potentially target to produce close to INR48 crores litres for the ethanol supplier November to October of 2025-26. So this gives us enough room to have the volumes that we foresee to give a good growth rate.

— Vijay Murugesh Nirani, Managing Director
Ethanol Supply Volume (Incremental) Ethanol Volume · November 2025 to October 2026 · Low confidence 15 crores liters

Also I will highlight to you Rishabh ji, that the incremental 15 crore litres is still work in progress. We are hopeful, but 47 is a done deal.

— Vijay Murugesh Nirani, Managing Director

SAF Blending

India SAF Blending Target SAF Blending · 2027 · High confidence 1%

So in fact the government of India's mandate to start blending of SAF by 1% in 2027 and up to 5% by 2030 is mostly for all the international flights flying in and out of India.

— Vijay Murugesh Nirani, Managing Director
India SAF Blending Target SAF Blending · 2030 · High confidence 5%

— Vijay Murugesh Nirani, Managing Director

CBG Capacity

Sumitomo JV CBG Plants (Phase 1) CBG Capacity · High confidence 4 plants (20 tons each)

The JV has Phase 1 investments to set up four CBG plants of 20 tons each at a cost of about INR85 crores each plant.

— Vijay Murugesh Nirani, Managing Director
Sumitomo JV CBG Plants (Phase 2) CBG Capacity · High confidence Additional 12 plants

And in the Phase 2, the JV also intends to explore an additional 12 plants in addition to the four. So total of the CBG plants will be 16, that is signed with Sumitomo Corporation.

— Vijay Murugesh Nirani, Managing Director

SAF Project

Andhra Pradesh SAF Plant Investment SAF Project · Medium confidence INR 2,250 crores

TruAlt is entering into a MOU with Andhra Pradesh government for an investment of up to INR2,250 crores for an ethanol to SAF plant.

— Vijay Murugesh Nirani, Managing Director
Andhra Pradesh SAF Plant Commissioning SAF Project · High confidence Within next two years

with the objective of commissioning and operating the facility over a period of the next – within the next two years.

— Vijay Murugesh Nirani, Managing Director
Andhra Pradesh SAF Plant Revenue Start SAF Project · FY28 · High confidence FY 2028

The revenue should start by FY 2028.

— Vijay Murugesh Nirani, Managing Director
Andhra Pradesh SAF Plant Funding Mix (Debt to Equity) SAF Project · Medium confidence 30-70

And the financing portion of it, we have currently thought that we will bring a 30-70 debt to equity

— Vijay Murugesh Nirani, Managing Director
Andhra Pradesh SAF Plant IRR SAF Project · High confidence 19%

our IRR will be close to factoring on the subsidy and capex, it will be around 3.5 to 4 years. Sorry, 3.5 to 4 years. IRR will be close to 19%.

— Anand Kishore, Chief Financial Officer

CBG Profitability

EBITDA Margin (for 16 plants) CBG Profitability · High confidence 60-65% minimum

my EBITDA margin will be around 60% to 65% minimum.

— Anand Kishore, Chief Financial Officer
PAT Margin CBG Profitability · High confidence 35% minimum

my PAT margin will be standing somewhere around, which if you will now see in my current balance sheet also, it will be around at 35% minimum

— Anand Kishore, Chief Financial Officer
IRR CBG Profitability · High confidence 21-22%

And in terms of IRR also, it will be around 21% to 22% will be on the PAT margin – IRR.

— Anand Kishore, Chief Financial Officer

Ethanol Profitability

EBITDA Margin Ethanol Profitability · Medium confidence 15-16%

We should see a trend of around 15%, 16% on EBITDA.

— Vijay Murugesh Nirani, Managing Director

Revenue Mix

Ethanol Contribution to Gross Revenue Revenue Mix · Next financial year · Medium confidence 85%

Previously 70%-odd → 85%

No, sorry. 85 and 15, somewhere about that. 85 would be from ethanol and 15 from CVG?

— Vijay Murugesh Nirani, Managing Director
CBG Contribution to Gross Revenue Revenue Mix · Next financial year · Medium confidence 15%

Previously 20-25% → 15%

— Vijay Murugesh Nirani, Managing Director

Risks & concerns

Ethanol Allocation & Oversupply
high

OMCs' 'questionable' allocation, Karnataka being a 'lowest allottee', and a 'huge distress' due to INR 1,800 crores liters supply vs 1,250 crores liters demand leading to oversupply.

Management acknowledged
Retail Fuel Network Rollout Challenges
medium

Challenges in getting approvals, licenses, and land clarity due to fragmented land ownership in India, despite fast rollout.

Management acknowledged
Ethanol Export Opportunity
low

'Far off opportunity' due to differential pricing where domestic ethanol is comparatively higher than export prices from Brazil/America.

Management acknowledged
SAF Blending Mandate (CORSIA)
low

CORSIA mandate is 'voluntary rather a mandatory blending of SAF by 2027', implying less immediate pressure or certainty.

Management acknowledged

Areas of evasion (1)

Specific breakup of grain vs. sugar ethanol allocation (offered to send via email).

Q&A highlights

3 direct

SAF Plant Funding Mix and IRR Direct

And the financing portion of it, we have currently thought that we will bring a 30-70 debt to equity... our IRR will be close to 19%.

Provides crucial financial details and profitability expectations for a major new strategic vertical, indicating capital structure and return on investment.

Asked by Piyush Bangar

Risk of Lower Government Ethanol Procurement Prices Direct

Yes. So as we were speaking earlier, we are already seeing a huge distress in the procurement policy of government, because currently there is a supply of close to INR1,800 crores liters of ethanol and the demand of close to 1250 crores liters of ethanol across the month. So, there is already an oversupply.

Directly addresses a significant sector-wide risk for their core ethanol business, acknowledging oversupply and potential impact on pricing and strategy.

Asked by Pratham Modi

Future Revenue Mix (Ethanol vs. CBG) Direct

No, sorry. 85 and 15, somewhere about that. 85 would be from ethanol and 15 from CVG?

Offers insight into the company's strategic vision for its portfolio balance and the expected contributions of its emerging CBG business relative to its established ethanol operations, with a clear revision.

Asked by Deepak Poddar

3 min read 6 chapters

Detailed narrative

Q2 FY26 Performance & Strategic Transformation

TruAlt Bioenergy reported a challenging Q2 FY26, with consolidated revenue from operations declining 68.07% YoY to INR 129 crores. The half-year (H1 FY26) revenue also saw a 28.55% YoY decline to INR 418 crores. This muted performance was attributed to a deliberate strategic plant shutdown in Q2 for multi-grain dual-feed integration, transforming the business from seasonal to near-continuous operation. Despite the top-line pressure, H1 FY26 net loss improved to INR 33.27 crores from INR 40.25 crores in H1 FY25, driven by significant cost optimization, particularly a 52.83% QoQ reduction in other expenses in Q2 FY26.

Ethanol Business Outlook & Dual-Feed Integration

The company has successfully converted 1,300 KLPD, or 65% of its total 2,000 KLPD ethanol capacity, to a multi-grain dual-feed system, allowing for year-round production using syrup, molasses, rice, maize, and damaged food grains. For the November 2025 to October 2026 ethanol supply year, TruAlt targets supplying 47 crores liters, which is considered a 'done deal.' This is an increase from the 26.78 crores liters supplied in FY25. The shift to bagasse-based power generation has significantly reduced power costs for ethanol production to INR 3.5-4 per liter, down from INR 6-8 per liter with coal, saving INR 11 crores in power and INR 7-8 crores in transportation costs.

Compressed Biogas (CBG) Expansion & Partnerships

The CBG segment demonstrated robust growth, with H1 FY26 revenue surging 65.28% YoY to INR 20.71 crores and PAT increasing by 691.4% YoY to INR 10.13 crores. The CBG business boasts an impressive EBITDA margin of 68.29% and a Q2 FY26 PAT margin of 49.85%. TruAlt has partnered with Sumitomo Corporation for a JV to establish 16 CBG plants, with Phase 1 comprising four 20-ton plants at a total capex of INR 350-360 crores. Construction has begun on three plants, expected to be operational by Q2 FY27. The company also has a JV with GAIL for seven additional CBG project locations.

Sustainable Aviation Fuel (SAF) Ventures

TruAlt is actively pursuing opportunities in Sustainable Aviation Fuel (SAF), aligning with India's mandate for 1% SAF blending by 2027 and 5% by 2030. The company has signed an MOU with the Andhra Pradesh government for an investment of up to INR 2,250 crores for an ethanol-to-SAF plant, targeting commissioning within the next two years and revenue generation by FY28. This project is planned with a 30-70 debt-to-equity funding mix and is projected to yield an IRR of 19% at 85-90% capacity utilization. Discussions are also underway with Sumitomo Corporation for potential SAF synergies.

Retail Fuel Network Development

The company is expanding its retail fuel network through a franchisee model, aiming for a 100-location rollout in Karnataka. Currently, seven outlets are operational, with six more ready to commence, bringing the total to 13 dispensing stations. This expansion strengthens downstream integration and enhances market presence. Management acknowledged challenges in securing approvals and clear land titles for new locations but highlighted the rapid rollout achieved so far, positioning TruAlt as one of the fastest in the sector.

Financial Health & Capital Structure

As of September 30, 2025, TruAlt's total balance sheet size stood at INR 3,377 crores. Total equity increased significantly to INR 1401.52 crores from INR 582 crores a year prior, reflecting IPO money infusion and anchor investor rounds. Non-current assets, primarily property, plant, and equipment, grew to INR 1,648.25 crores from INR 1,253.79 crores due to multi-feeder plant introductions. The company's trade payables decreased substantially to INR 68.39 crores from INR 255.23 crores, indicating improved working capital management.

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

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