VST Industries Limited shareholders approved a dividend of ₹12 per equity share for the financial year ended March 31, 2026, during its 95th Annual General Meeting (AGM) held on July 29, 2026. The meeting, conducted via video conference from 10:00 a.m. to 12:10 p.m. (IST), also saw the ratification of the company’s audited financial statements and the reappointment of Naresh Kumar Sethi as a director by rotation. These approvals signal continued stability in corporate governance and shareholder returns for the tobacco manufacturer.

The proceedings were chaired by Naresh Kumar Sethi, with Phani Mangipudi, Company Secretary and Vice President-Legal & Secretarial, overseeing compliance and voting procedures. In accordance with Regulation 30 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the company disclosed the outcomes of the ordinary resolutions. B.V. Saravana Kumar, a Practicing Company Secretary, served as the scrutinizer for the e-voting process, ensuring transparency in the shareholder vote. Both the Statutory Auditors and the Secretarial Auditor issued unqualified reports for FY26, confirming the integrity of the financial disclosures.

Key Resolutions Passed

Shareholders voted on four ordinary resolutions during the AGM. The detailed outcomes are summarized below:

The adoption of the financial statements for the year ended March 31, 2026, included the reports of the Board of Directors and the Auditors. The declaration of the ₹12 dividend represents a direct return to shareholders, reflecting the company’s liquidity position and profit distribution strategy for the fiscal year.

Governance and Audit Appointments

Naresh Kumar Sethi, who retires by rotation, offered himself for reappointment and was duly approved by the members. His continued tenure ensures leadership continuity for the Board. Additionally, the shareholders appointed M/s. Price Waterhouse Chartered Accountants LLP (Registration No. 012754N/N500016) as the Statutory Auditors of the Company. This appointment is critical for maintaining independent oversight of the company’s financial reporting mechanisms.

During the session, registered speaker shareholders had the opportunity to raise questions and seek clarifications on agenda items. Queries received via email were also addressed by the management team. The Chairman introduced the participating Board Members and Management team before delivering his address, fostering engagement between the leadership and investors. Members who had not voted electronically during the pre-AGM period were given the opportunity to cast their votes at the conclusion of the meeting, maximizing participation rates.

VST Industries reported a net revenue decline of 13.5% to ₹256 crore for the quarter ended June 30, 2026 (Q1FY27), driven by a significant increase in indirect taxes on cigarettes. Net profit after tax (PAT) fell 24% year-on-year to ₹42.4 crore from ₹56.1 crore in the corresponding quarter of FY26. The company attributed the downturn to an extraordinary tax hike that increased the average incidence of tax on cigarettes by approximately 50%, alongside a 14.4% quarter-on-quarter drop in cigarette volumes to 611 million units. Management warned of a challenging year ahead due to these regulatory changes and the persistent threat of illicit trade.

The Board of Directors approved the unaudited results on July 28, 2026. The financial statements were prepared in accordance with Indian Accounting Standards (Ind AS) and Regulation 33 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. B S R & Associates LLP, the Statutory Auditor, issued an unqualified limited review report on the interim financial information.

Key Financial Metrics

The following table summarises the company's key financial performance across comparable periods:

Gross sales, as reported in exchange filings, stood at ₹86,127 lakh (₹861.27 crore), which includes GST and excise duty components that are excluded from the net revenue figure disclosed in the press release. On a gross revenue basis, EBITDA margin stood at 5.76% compared to 18.58% in the year-ago period, reflecting the significant distortion introduced by the restructured indirect tax framework effective February 1, 2026. The divergence between gross and net revenue metrics underscores the scale of the tax structure change. Unmanufactured tobacco revenue remained relatively stable at ₹40 crore compared to ₹41 crore in the prior year period.

Profitability Under Pressure

Profitability metrics reflected significant pressure during the quarter. EBITDA fell sharply to ₹50 crore, down 35% from ₹77 crore in the year-ago period. The EBITDA margin contracted by 650 basis points quarter-on-quarter to 19.5% from 45.5% in Q4FY26. Profit before tax was impacted by higher tax burdens, with excise duty expenses totaling ₹60,525 lakh as per the detailed filing. Tax expenses amounted to ₹1,586 lakh, comprising current tax of ₹1,394 lakh and deferred tax of ₹192 lakh. Consequently, profit after tax settled at ₹42.4 crore. Earnings per share were reported at ₹2.50, compared to ₹3.30 in the prior year's corresponding period.

What the Numbers Show

The most critical aspect of this filing is the disclosure regarding indirect tax changes. Effective February 1, 2026, the Government of India reduced the Compensation Cess on cigarettes to nil while significantly increasing GST and Excise Duty. VST Industries explicitly stated that due to these amendments, figures for Gross Sales (net of GST and Compensation Cess) and Excise Duty for Q1FY27 are not comparable with other periods presented. This regulatory shift distorts standard year-on-year growth analysis, suggesting that operational volume or price trends cannot be directly inferred from the headline revenue figures without adjusting for the tax structure change. The sharp contraction in EBITDA margin — from 26.0% to 19.5% on a net revenue basis — similarly reflects the impact of this restructured tax framework on reported financials. Piyush Srivastava, Managing Director, noted that the company is adopting a measured pricing approach to protect its consumer base but remains focused on recovering volumes through disciplined in-market execution. Geopolitical instability in the Middle East continues to weigh on the unmanufactured tobacco business.