Bhagiradha Chemicals & Industries , a leading agrochemical manufacturer, has reported a mixed financial performance for the first quarter of fiscal year 2026. The company saw an 11% year-over-year increase in revenue, reaching Rs. 123.80 crores, up from Rs. 111.40 crores in the same quarter last year. However, profitability metrics faced headwinds due to pricing pressures and increased costs.

Financial Highlights

• Revenue from operations grew by 11% year-over-year to Rs. 123.80 crores
• EBITDA declined by 25% to Rs. 9.00 crores, with margins contracting to 7.30% from 10.80%
• Profit After Tax (PAT) decreased by 30% to Rs. 4.00 crores

Performance Analysis

The company attributed its revenue growth to strong volume recovery, which offset pricing pressures in the market. However, the positive impact of increased volumes was tempered by margin compression resulting from raw material cost pressures and higher finance costs.

Bhagiradha Chemicals maintains a strong export focus, with 97% of its revenue coming from international markets and only 3% from domestic sales.

Operational Update

The company is in the midst of a significant capacity expansion plan. Phase I of this expansion is expected to be operational by September 2025, representing a total investment of over Rs. 800.00 crores for greenfield expansion.

Management Commentary

A. Arvind Kumar, Executive Director & CEO, commented on the performance: "After a challenging FY25 marked by pricing pressures, we entered FY26 with a strong recovery in volumes. While pricing pressures persist, we believe they have now bottomed out, setting the stage for gradual improvement ahead."

He added, "As volumes continue to improve, we expect operating leverage benefits to gradually flow through, supporting margin recovery in the coming quarters. Our capex plan remains firmly on track, with Phase I expected to be operational by September 25, followed by a 12–18-month ramp-up."

Future Outlook

Despite global headwinds and pricing pressures, the company sees early signs of demand recovery with volume rebound. Management expects gradual improvement through FY26, with pricing likely having bottomed out.

Bhagiradha Chemicals remains focused on its strategic roadmap, which includes:

• Driving innovation
• Advancing backward integration
• Expanding capacity
• Strengthening R&D

The company is targeting a 5x revenue growth over the next 6-7 years through these initiatives, along with new product development and contract manufacturing opportunities.

New Product Introduction

During the quarter, Bhagiradha Chemicals strengthened its portfolio by introducing Pinoxaden, a new product in the herbicide segment, which is expected to support long-term growth.

The company's commitment to innovation and expansion, coupled with its strong export presence, positions it to navigate current market challenges while pursuing ambitious growth targets in the coming years.

Bhagiradha Chemicals & Industries , a prominent player in the agrochemicals sector, has reported a robust financial performance for the first quarter, along with significant strategic moves to strengthen its subsidiary.

Q1 Financial Highlights

The company announced its unaudited standalone financial results for the quarter ended June 30:

• Revenue from operations increased by 11.7% to ₹123.78 crore, compared to ₹110.78 crore in the same period last year.
• Net profit saw a substantial rise of 14.6% to ₹8.29 crore, up from ₹7.23 crore year-over-year.
• Total income, including other income, stood at ₹127.27 crore, marking a 11.2% increase from ₹114.41 crore in the previous year's corresponding quarter.

Strategic Moves and Corporate Actions

Subsidiary Loan Conversion

In a significant move, Bhagiradha Chemicals converted a loan of ₹367.53 crore extended to its wholly-owned subsidiary, Bheema Fine Chemicals Private Limited, into equity share capital. This strategic decision, approved by the Board of Directors on May 13, resulted in the allotment of 4,08,36,237 equity shares at ₹90 per share to Bhagiradha Chemicals. This conversion is expected to strengthen the capital structure of Bheema Fine Chemicals and support its growth initiatives.

Tax Rate Optimization

The company has adopted a reduced corporate tax rate of 22%, effective from April 1, as permitted by the Taxation Laws (Amendment) Ordinance, 2019. This move led to a remeasurement of deferred tax liabilities, resulting in a reduction of ₹3.08 crore, which has been recognized in the Statement of Profit and Loss for the quarter.

Consolidated Performance

On a consolidated basis, including its wholly-owned subsidiary Bheema Fine Chemicals Private Limited, Bhagiradha Chemicals reported:

• Revenue from operations of ₹123.78 crore
• Net profit of ₹3.98 crore

Preferential Issue and Fund Utilization

The company confirmed that there has been no deviation in the use of proceeds from the preferential issue of convertible warrants. A total of ₹341.18 crore has been raised across multiple tranches, with the funds being utilized as per the stated objectives, including:

1. Funding the capital expenditure for setting up a new manufacturing unit under Bheema Fine Chemicals Private Limited in Kadechur Industrial area, Yadgir district, Karnataka.
2. Allocating ₹21.18 crore towards working capital requirements and preliminary expenses for the subsidiary's project.

Outlook

Bhagiradha Chemicals' strong Q1 performance, coupled with strategic initiatives like the subsidiary loan conversion and tax rate optimization, positions the company for potential growth in the agrochemicals sector. The ongoing investments in manufacturing capabilities through its subsidiary suggest a focus on expanding production capacity and market presence.