Sudarshan Chemical reports robust Q4, net debt falls to INR755 crores
Sudarshan Chemical Industries reported a robust Q4FY26 performance with a Business EBITDA of INR118 crores, driven by value capture initiatives and the end of customer destocking. Net debt decreased to INR755 crores from INR934 crores in December 2025. The acquired group exceeded projections with a Business EBITDA of EUR 11 million. RIECO turned profitable with an EBITDA of INR10 crores. Management expects an EBITDA of EUR 35 million for the next financial year and aims to achieve synergies of EUR 90-100 million over 3-4 years.
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Sudarshan Chemical Industries reported a robust performance in Q4FY26, achieving a Business EBITDA of INR118 crores driven by value capture initiatives and the end of customer destocking. The company’s net debt decreased significantly to INR755 crores as of March 26, 2026, down from INR934 crores in December 2025. Management expressed confidence in the strategic rationale of the Heubach acquisition and expects to deliver an EBITDA of EUR 35 million for the next financial year.
Operational Performance and Integration
The company’s Business EBITDA for the quarter was INR118 crores, derived from a reported EBITDA of INR73 crores. This figure was adjusted for a one-time purchase price allocation credit of INR37 crores and a release of INR82 crores of inventorized overheads due to inventory reduction. The acquired group delivered a Business EBITDA of EUR 11 million, exceeding the projected EUR 9-10 million. The company reduced inventory by EUR 29 million during the quarter, surpassing the target of EUR 20 million.
Financial Metrics
| Metric | Value |
|---|---|
| Reported EBITDA | INR73 crores |
| Business EBITDA | INR118 crores |
| Net Debt (Mar '26) | INR755 crores |
| Net Debt (Dec '25) | INR934 crores |
| Inventory Reduction | EUR 29 million |
Segment Performance
RIECO reported revenue from operations of INR268 crores for FY26, a growth of 17.5% compared to INR228 crores in the previous year. The segment turned profitable with an EBITDA of INR10 crores, recovering from a negative EBITDA of INR17 crores last year. This improvement was driven by high-value project execution, organizational restructuring, and robust cost monitoring.
Outlook and Guidance
Management stated that the destocking situation on Legacy Heubach products is easing and almost over. While navigating geopolitical challenges and rising raw material costs, the company is leveraging its global footprint to ensure supply chain resilience. Sudarshan Chemical expects to achieve synergies of EUR 90 million to EUR 100 million over the next 3 to 4 years. For the upcoming financial year, the company projects an EBITDA of EUR 35 million, supported by volume recovery, margin discipline, and cost optimization.
Historical Stock Returns for Sudarshan Chemical Industries
| 1 Day | 5 Days | 1 Month | 6 Months | 1 Year | 5 Years |
|---|---|---|---|---|---|
| +3.51% | -1.47% | -5.71% | -8.32% | -30.49% | +28.74% |
How will the company mitigate the impact of rising raw material costs on margins in the upcoming financial year?
What specific strategies will be employed to achieve the projected EUR 90-100 million in synergies over the next 3-4 years?
Will the significant reduction in net debt free up capital for further acquisitions or shareholder returns?
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