Nikhil Adhesives Reports Q2 FY26 Revenue of Rs 13,105.31 Lakhs, Implements New Inventory Valuation Method

Nikhil Adhesives Limited , a manufacturer of adhesives, binders, and chemicals, has announced its unaudited financial results for the second quarter and half-year ended September 30, 2025. The company reported a quarterly revenue from operations of Rs 13,105.31 lakhs and a profit after tax of Rs 317.34 lakhs.

Key Financial Highlights

Particulars (Rs. in Lakhs)	Q2 FY26	Q2 FY25	H1 FY26	H1 FY25
Revenue from Operations	13,105.31	14,768.71	25,452.45	30,885.35
Total Income	13,216.24	14,781.03	25,574.42	30,909.97
Profit Before Tax	587.37	518.14	1,054.55	1,168.64
Profit After Tax	317.34	415.43	784.53	899.72

Change in Inventory Valuation Method

In a significant accounting policy change, Nikhil Adhesives has revised its method for valuing inventories. Effective from April 1, 2025, the company has transitioned from the First-In-First-Out (FIFO) method to the Weighted Average Method for raw materials and packing materials. Additionally, for other materials, the company has shifted from FIFO to the Standard Cost Method.

The company believes this change will provide a more accurate reflection of the actual cost flows and physical movement of goods. It is also expected to enhance comparability with industry peers, offering more reliable and relevant information to financial statement users.

Impact of Accounting Policy Change

The shift in inventory valuation methods has led to retrospective adjustments in the company's financial statements. Key impacts include:

A cumulative effect on retained earnings of Rs 44.76 lakhs as of April 1, 2024.
For the quarter ended September 30, 2024, the change resulted in a decrease in profit before tax by Rs 57.69 lakhs and a reduction in profit after tax by Rs 43.17 lakhs.
The basic and diluted Earnings Per Share (EPS) for the same quarter decreased by Rs 0.09.

Financial Position

As of September 30, 2025, Nikhil Adhesives reported:

Total assets of Rs 29,158.94 lakhs
Total equity of Rs 13,598.93 lakhs
Cash and cash equivalents of Rs 35.61 lakhs

The company's board of directors approved these results in a meeting held on November 13, 2025. The financial statements have been prepared in accordance with Indian Accounting Standards (IND AS) and have undergone a limited review by the statutory auditors.

Nikhil Adhesives Limited continues to focus on its core business of manufacturing adhesives, binders, emulsions, chemicals, monomers, and solvents, which constitutes its sole reporting segment under IND AS 108 'Operating Segments'.

Investors and stakeholders should note that these changes in accounting policies may affect the comparability of financial results across periods and should be considered when analyzing the company's performance.

1 Day	5 Days	1 Month	6 Months	1 Year	5 Years
+0.79%	-4.00%	-16.22%	-1.29%	-21.86%	-51.89%

Nikhil Adhesives Limited , a leading manufacturer of adhesives, binders, and chemicals, has released its financial results for the second quarter, revealing a decline in revenue and profit compared to the same period last year. The company has also announced significant changes to its board structure and set the date for its upcoming Annual General Meeting (AGM).

Financial Performance

For the quarter ended June 30, Nikhil Adhesives reported:

Particulars (Rs. in Lakhs)	Q2 Current	Q2 Previous	YoY Change
Revenue from Operations	12,347.14	16,116.64	-23.39%
Net Profit	356.74	503.86	-29.20%
Basic EPS (Rs.)	0.78	1.10	-29.09%

The company's revenue from operations decreased by 23.39% to Rs. 12,347.14 lakhs, down from Rs. 16,116.64 lakhs in the same quarter last year. Net profit also saw a decline of 29.20%, falling to Rs. 356.74 lakhs from Rs. 503.86 lakhs in the previous year's corresponding quarter.

Strategic Shift in Operations

Nikhil Adhesives has announced a strategic decision to reduce its trading division and focus more on its manufacturing operations. This move comes in response to prevailing market conditions, as stated in the company's financial report.

Board Restructuring and Committee Changes

The Board of Directors has approved a significant restructuring of its committees, effective August 8. The changes include:

Reconstitution of the Audit Committee, Nomination and Remuneration Committee, Stakeholder Relationship Committee, and Corporate Social Responsibility Committee.
Voluntary adoption of a Risk Management Committee.

Annual General Meeting and Auditor Appointments

Nikhil Adhesives has scheduled its 39th Annual General Meeting for September 23, to be held virtually through video conferencing. Key points include:

The Board has recommended the appointment of PHD & Associates as statutory auditors for a five-year term from FY 2025-26 to FY 2029-30, subject to shareholder approval.
M/S Somani & Associates has been proposed as secretarial auditors for a five-year term, pending AGM approval.

Change in Accounting Policy

The company has implemented a change in its accounting policy for inventory valuation. Effective April 1, Nikhil Adhesives has shifted from the FIFO (First-In-First-Out) method to:

Weighted Average method for Raw Materials and Packing Materials
Standard Cost method for other materials

This change aims to better reflect the actual cost flows and improve comparability with industry peers. The company has retrospectively applied this change, resulting in a cumulative effect on retained earnings of Rs. 59.82 lakhs as of April 1 of the previous year.

Outlook

While Nikhil Adhesives faces challenges reflected in its Q2 results, the company's strategic decisions to focus on manufacturing and restructure its board committees indicate efforts to adapt to market conditions and strengthen corporate governance. The upcoming AGM and proposed auditor appointments suggest a focus on maintaining transparency and accountability in its operations.