Century Enka Reports Q2 FY26 Results: Revenue Declines Amid Chinese Import Pressure

Century Enka Limited , a leading player in the nylon and polyester filament yarn industry, has reported its financial results for the second quarter of fiscal year 2026, revealing challenges in the face of increased Chinese imports and subdued demand.

Financial Performance

The company reported an operating revenue of INR 409.00 crores for Q2 FY26, marking a 24% year-on-year decline but a 2% quarter-on-quarter increase. EBITDA stood at INR 32.00 crores with margins at 7.73%, while profit after tax was INR 22.00 crores, up 4% year-on-year.

For the first half of FY26, Century Enka's performance was as follows:

Metric	H1 FY26	YoY Change
Operational Revenue	INR 810.00 crores	-24%
EBITDA	INR 52.00 crores	-35%
EBITDA Margin	6.37%	-
Net Profit	INR 38.00 crores	-17.5%
Total Volumes	34,992 metric tons	-14%

Segment-wise Performance

Tyre cord fabric sales for H1 FY26 declined by 32% to INR 365.00 crores
Filament yarn sales declined by 15% to INR 404.00 crores

Market Challenges

The company faced significant challenges from subdued demand and increased low-cost imports from China in both tyre cord fabrics and filament yarn segments. The nylon filament yarn segment, in particular, saw imports double year-on-year, with China accounting for 90-95% of these imports.

Strategic Initiatives

To counter these challenges, Century Enka is focusing on several strategic initiatives:

Value-Added Products: Over 35% of the company's nylon filament yarn portfolio now consists of value-added products, with plans to increase this to over 50% in the next few years.
PTCF Project: The company is progressing with its Polyester Tyre Cord Fabric (PTCF) project, with an investment of approximately INR 100.00 crores. Commercial supplies are expected to begin in Q4 FY26.
Renewable Energy: Currently, 15-20% of the company's power requirements are met through renewable sources, with plans to increase this to 30-35% in the next 1-2 years.
Anti-Dumping Measures: The industry is actively pursuing anti-dumping duties on nylon filament yarn imports from China, with a decision expected before December.

Outlook

Despite current challenges, Century Enka sees potential for improvement in the second half of FY26, supported by recent GST reductions on tyres and anticipated festive season demand. However, the company remains cautious due to ongoing geopolitical tensions and trade uncertainties.

Mr. Suresh Sodani, Managing Director of Century Enka, commented, "We are hopeful that the trends we've seen following the GST cuts will continue. There's a general positivity in the value chain that this should sustain and lead to better demand."

As Century Enka navigates these challenging market conditions, it continues to focus on operational efficiency, product innovation, and strategic investments to maintain its competitive edge in the technical textile industry.

1 Day	5 Days	1 Month	6 Months	1 Year	5 Years
+0.54%	+1.21%	-1.41%	+6.59%	-27.01%	+160.16%

Century Enka Limited , a leading producer of Nylon Filament Yarn (NFY) and Nylon Tyre Cord Fabric (NTCF) in India, has released its financial results for the second quarter of fiscal year 2026, revealing a mixed performance amidst challenging market conditions.

Financial Highlights

Metric	Q2 FY26	Q2 FY25	Y-o-Y Change
Revenue from Operations	4,087.00	5,363.00	-23.80%
EBITDA	316.00	379.00	-16.60%
EBITDA Margin	7.73%	7.07%	+66 bps
Net Profit	223.00	214.00	+4.20%
PAT Margin	5.46%	3.99%	+147 bps

Operational Performance

Century Enka faced headwinds in its core business segments during Q2 FY26:

Tyre Cord Fabric (Reinforcement)

Volumes continued to be impacted by lower demand and increased imports from China.
Margins remained under pressure due to cheap imports.
The company expects NTCF demand to improve following GST cuts on tyres and a potential uptick in the auto industry.

Filament Yarn

Sales volumes improved sequentially after the restart of a plant following fire disruption and revamp.
New investments in Mother Yarn and Value-Added Products (VAPs) helped improve margins.
However, significantly increased imports from China at very low prices impacted margins on commodity products.

Raw Material and Cost Management

Caprolactam prices continued to decline to record lows, though the pace of decline has reduced.
The company's focus on renewable energy at its Bharuch plant helped control power costs.
Continuous efficiency improvement efforts are helping to offset pressure on margins.

Market Position and Outlook

Century Enka maintains a strong market position with:

23% domestic market share in NFY
25% domestic market share in NTCF

The company anticipates better demand in the second half of FY26 due to the festive season and the potential positive impact of favorable monsoons on farm income. However, ongoing geopolitical tensions and trade conflicts remain key risks for the entire value chain.

Strategic Initiatives

The company is pursuing anti-dumping duty (ADD) to counter low-price dumping from China in the filament yarn segment.
Approval process for Polyester Tyre Cord Fabric (PTCF) is progressing as per schedule, indicating potential diversification efforts.

Despite the challenging quarter, Century Enka's focus on efficiency, product diversification, and strategic investments in value-added products demonstrates its efforts to navigate the current market dynamics and position itself for future growth.

Investors and market watchers will be keen to see how the company's strategies unfold in the coming quarters, particularly in light of the expected demand improvements and ongoing efforts to counter import pressures.