Sanstar reported a 18.1% decline in revenue from operations to ₹784.6 crore for the financial year ended March 31, 2026, compared to ₹957.4 crore in the previous year. Profit after tax fell 21.3% to ₹34.5 crore, reflecting headwinds in native starch pricing and lower volumes.

The maize-based specialty products manufacturer navigated a challenging first half marked by Chinese export surges into Southeast Asia and an annual maintenance shutdown. Despite the topline pressure, gross margin expanded to 30.1% from 25.9%, as the company optimized its product mix and controlled costs.

Capacity Expansion and Balance Sheet

A key milestone for the year was the commissioning of a 1,250 tonnes per day (TPD) expansion at its Dhule facility. Total installed capacity rose from 1,100 TPD to 2,350 TPD, funded largely by IPO proceeds. This positions the company as India’s second-largest maize-based specialty products manufacturer.

The balance sheet strengthened significantly. Finance costs dropped 81% to ₹1.4 crore, and net debt improved from ₹93.7 crore to a near-neutral ₹3.7 crore, even after deploying ₹178.5 crore in investing activities.

Financial Performance

Note: Gross profit figure derived from Chairman's message; EBITDA/PAT from KPI tables.

What the Numbers Show

While revenue contracted sharply, the divergence between top-line decline and stable gross profit indicates successful margin preservation. Gross margin expanded by 420 basis points to 30.1%, suggesting that higher-value products or cost efficiencies offset the volume loss in commoditized native starch. Additionally, the drastic reduction in finance costs (from ₹7.5 crore to ₹1.4 crore) contributed disproportionately to bottom-line stability relative to operating profit declines.

Strategic Outlook

Exports accounted for 34% of revenue across 41 countries. Geographically, Asia’s share of exports fell from 68% to 49%, as the company diversified into the Americas, Africa, and the Middle East to mitigate regional pricing pressures.

Looking ahead, management expects the upcoming derivatives facility at Dhule, slated for commissioning in FY27, to further stabilize margins through value-added products like liquid glucose and dextrose. The Board has not recommended a dividend for FY26, opting to retain earnings for internal deployment.

Sanstar delivered a strong operational turnaround in Q1FY27, reporting revenue of ₹2,062 million against ₹1,697 million in the same quarter last year. The company swung to a net profit of ₹92 million from a net loss of ₹3 million in the year-ago period, supported by improved gross margins and normalized production levels.

Q1FY27 financial performance

The quarterly results reflect significant improvement across both topline and bottom-line metrics on a year-on-year basis. Gross profit expanded by 67.4% to ₹689 million, lifting the gross margin to 33.4% from 24.3%. EBITDA turned positive at ₹154 million (7.5% margin), compared to an EBITDA loss of ₹9 million in Q1FY26.

| Metric: | Q1FY27 | Q1FY26 | Change | | ---: | :--- | :--- | :--- | | Revenue: | ₹2,062 million | ₹1,697 million | +21.5% | | Gross Profit: | ₹689 million | ₹412 million | +67.4% | | EBITDA*: | ₹154 million | (₹9) million | nm | | Net Profit / (Loss): | ₹92 million | (₹3) million | nm |

*EBITDA excludes other income.

Operational updates and capacity expansion

The financial improvement was underpinned by key operational developments. The company completed a phase of its capacity expansion at Dhule during the quarter, scaling the addition from the originally planned 1,000 TPD to 1,250 TPD. This has increased Sanstar’s total installed manufacturing capacity from 1,100 TPD to 2,350 TPD. The derivatives facility at Dhule is expected to be commissioned in FY26-27.

Export revenue grew by 24.5% year-on-year to ₹723 million, supported by higher plant availability. Exports continue to contribute approximately 34% of total revenues, with the company serving 34 countries.

Strategic investment and cost reduction

Sanstar completed a preferential allotment to Corn Products Development Inc., a subsidiary of Ingredion Incorporated. The company raised approximately ₹1,983 million through the issue, with Ingredion’s subsidiary holding approximately 9% of Sanstar Limited following the allotment. This partnership provides access to global R&D infrastructure and technical expertise.

Additionally, the company commissioned a 3 MW solar power plant at its Kutch facility in August 2026, investing approximately ₹7.5 crore. This plant is expected to meet around 40% of the Kutch facility’s electricity requirement, resulting in annual power cost savings of approximately ₹3 crore.

What the Numbers Show

The shift from an EBITDA loss of ₹9 million in Q1FY26 to a profit of ₹154 million in Q1FY27 highlights the impact of operational normalization and capacity utilization. While revenue growth of 21.5% was robust, the disproportionate jump in gross profit (67.4%) indicates significant margin expansion, likely driven by the mix of products and improved efficiency from the newly commissioned capacity. However, management noted that short-term pricing pressure in native starch persists due to Chinese exports, suggesting that margin sustainability will depend on volume growth and the upcoming derivatives capacity.