Munjal Showa Limited has delivered strong financial performance for the third quarter of fiscal year 2026, with the auto components manufacturer reporting significant growth in both revenue and profitability. The company's Board of Directors approved the unaudited financial results for the quarter and nine months ended December 31, 2025, during their meeting held on February 07, 2026.

Strong Quarterly Performance

The company demonstrated robust quarterly performance with substantial improvements across key financial metrics. Revenue from operations increased to Rs. 34,968.17 lakhs in Q3 FY26, marking a growth of 9.59% compared to Rs. 31,908.48 lakhs in the corresponding quarter of the previous year.

Nine-Month Performance Overview

For the nine months ended December 31, 2025, Munjal Showa Limited maintained its growth trajectory with consistent performance improvements. The company reported revenue from operations of Rs. 96,834.66 lakhs compared to Rs. 94,755.83 lakhs in the corresponding period of the previous year, representing a growth of 2.19%.

Exceptional Items and Special Provisions

The company reported exceptional items charge of Rs. 220.02 lakhs during the quarter, related to the implementation of new Labour Codes. The Government of India notified provisions of various labour codes on November 21, 2025, which resulted in an increase in gratuity liability arising from past service cost. The company presented this incremental amount as an exceptional item due to its non-recurring nature.

Additionally, total expenses for the nine months ended December 31, 2025, were higher by Rs. 322.51 lakhs due to separation costs paid to employees opting for the Voluntary Retirement Scheme (VRS).

Operational Efficiency and Cost Management

The company maintained effective cost management while scaling operations. Cost of materials consumed increased proportionally with revenue growth, reaching Rs. 26,859.36 lakhs in Q3 FY26 compared to Rs. 24,881.32 lakhs in the previous year. Employee benefits expense stood at Rs. 3,187.69 lakhs for the quarter, reflecting the company's investment in human resources.

Corporate Governance and Compliance

The financial results have been prepared in accordance with Indian Accounting Standard 34 "Interim Financial Reporting" and comply with SEBI Listing Regulations. The results were reviewed by the Audit Committee and subjected to limited review by statutory auditors Deloitte Haskins & Sells LLP. The company operates within a single primary business segment of auto components and has no subsidiary, associate, or joint venture companies as of December 31, 2025.

Munjal Showa Limited has received a Goods and Services Tax (GST) demand order worth ₹33.28 lakhs from tax authorities in Uttarakhand for the financial year 2021-22. The company disclosed this development to stock exchanges on December 23, 2025, in compliance with regulatory requirements.

GST Demand Order Details

The demand order was issued under Section 73(9) of the SGST CGST Act 2017 by the Deputy Commissioner's office in Haridwar, Uttarakhand. The order carries reference number ZD051225017995A and is dated December 22, 2025.

Nature of Violation

According to the company's disclosure, the demand order stems from a show cause notice issued under Section 73 of the SGST CGST Act 2017. The tax department alleged that no payment was made for the specified period, leading to the issuance of the demand order for FY 2021-22. The communication was received through email on December 22, 2025.

Company's Response Strategy

Munjal Showa Limited has indicated its intention to contest the GST demand order. The company stated it will challenge the order based on strong merits by filing a reply or appeal with the tax department. This suggests the company believes it has valid grounds to dispute the demand.

Impact Assessment

The company has assessed that there will be no material impact on its financial, operational, or other activities due to this GST demand order. This assessment indicates that the ₹33.28 lakh demand amount is not expected to significantly affect the company's business operations or financial performance.

Regulatory Compliance

The disclosure was made under Regulation 30 read with Schedule III of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. The company provided detailed information as required by regulatory guidelines, including the nature of the action, violation details, and potential impact assessment. Munjal Showa Limited manufactures automotive components including struts, shock absorbers, front forks, and gas springs in collaboration with Astemo Limited.