Haryana Leather Chemicals reported a steep contraction in net profit for the quarter ended June 30, 2026, signaling margin pressure despite top-line growth. The company’s net profit after tax (PAT) fell 96% year-on-year to ₹3.11 lakh, down from ₹74.35 lakh in the corresponding quarter of FY25. This decline occurred even as revenue from operations rose 25% to ₹1,468.16 lakh, highlighting a significant divergence between sales growth and bottom-line performance.

The Board of Directors approved the unaudited standalone financial results in a meeting held on August 10, 2026. The results were reviewed by the Audit Committee and subjected to a limited review by the statutory auditors, S.C. Dewan & Co., in accordance with Regulation 33 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. The auditors issued an unmodified review report, stating that nothing came to their attention to suggest the statement contained material misstatements.

Financial Performance Overview

The company’s total income for the quarter stood at ₹1,526.34 lakh, comprising ₹1,468.16 lakh from operations and ₹58.18 lakh in other income. Other income increased significantly from ₹45.70 lakh in Q1FY25. However, this was offset by a substantial rise in operating expenses, particularly cost of materials consumed.

Earnings per share (EPS) dropped to ₹0.06 from ₹1.51 in the previous year’s corresponding quarter. The paid-up equity share capital remained unchanged at ₹490.84 lakh.

What the Numbers Show

The primary driver of the profit decline was the disproportionate rise in cost of materials consumed, which surged 64.1% to ₹1,234.50 lakh, far exceeding the 24.8% growth in revenue. This suggests that input cost inflation was not fully passed on to customers or absorbed through operational efficiencies. While employee benefits and other expenses saw moderate increases, the spike in raw material costs compressed margins significantly. The profit before tax narrowed to just ₹3.11 lakh, indicating that the company operated nearly at break-even levels during the quarter. For investors, this highlights sensitivity to input cost volatility in the leather finishing chemicals segment.

Haryana Leather Chemicals Limited reported a net profit of ₹237.70 lakh for the financial year ended March 31, 2026, an increase from ₹230.01 lakh in the previous year. Revenue from operations for FY26 rose to ₹5,136.51 lakh compared to ₹4,902.95 lakh in FY25. The board of directors approved a final dividend of ₹1 per equity share of face value ₹10 each for FY26, subject to shareholder approval at the ensuing Annual General Meeting. The audited financial results were published in The Financial Express and Jansatta on May 30, 2026, pursuant to Regulation 47 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

The board appointed M/s. Prince Kumar & Associates, Chartered Accountant, as the internal auditor for the financial year 2026-27 based on the Audit Committee's recommendation. The statutory auditors, M/S. S.C. Dewan & Co., issued an unmodified opinion on the audited standalone financial results, which were reviewed by the Audit Committee. The company operates in the Leather Finishing Chemicals manufacturing segment, its sole reportable segment under IND AS 108.

For the quarter ended March 31, 2026, the company reported a net profit of ₹38.92 lakh, a decrease from ₹57.46 lakh in the quarter ended December 31, 2025. Revenue for the quarter stood at ₹1,472.30 lakh, with total income at ₹1,508.06 lakh and total expenses at ₹1,433.48 lakh. The basic and diluted earnings per share (EPS) for FY26 were ₹4.84, compared to ₹4.69 in the previous year. For the quarter ended March 31, 2026, the EPS was ₹0.79.

The company's paid-up equity share capital remained unchanged at ₹490.84 lakh. The cash and cash equivalents as of March 31, 2026, were ₹1,121.04 lakh, up from ₹741.26 lakh in the previous year. The net cash generated from operating activities for the year was ₹468.73 lakh. The total assets of the company as of March 31, 2026, stood at ₹5,206.67 lakh.