Submission of Press Release in respect of Audited (Standalone and Consolidated) Financial Results for the quarter and financial year ended March 31,2026
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S H Kelkar reported FY26 revenue of Rs. 2,368 crore, up 11.5% YoY, driven by strong performance in flavours (30% growth) and sustained domestic fragrance demand. However, adjusted EBITDA fell to Rs. 323 crore from Rs. 335 crore, with EBITDA margins contracting to 13.9% from 15.9% in FY25. The company attributed the margin pressure to rising raw material costs driven by Middle East geopolitical developments, though current quarter was cushioned by existing inventory coverage. Q4 FY26 showed similar trends — revenue up 14.6% YoY at Rs. 650 crore, but EBITDA margin down to 13.5% from 14.6%. The CFO flagged that margin impact from cost pressures may become visible in coming quarters, with management planning pricing measures, cost optimisation, and business mix adjustments. The company is also prioritising improving cash conversion cycle and reducing debt.
Revenue growth is healthy but margin contraction and rising input costs are concerns. The CFO's explicit warning of margin pressure in coming quarters, combined with higher inventory requirements in an uncertain supply environment, suggests near-term profitability headwinds. Investors should monitor raw material cost trends and the success of pricing actions.