OCCL Limited Reports 16% Revenue Growth in Q2 FY26 Amid Margin Pressures

OCCL Limited , a leading manufacturer of insoluble sulphur and sulphuric acid, has reported a 16% year-on-year growth in total income for Q2 FY26, despite facing challenges from rising raw material costs and international trade pressures.

Financial Highlights

Metric	Q2 FY26	Q2 FY25	YoY Change
Total Income	Rs. 121.00 crores	Rs. 104.00 crores	16% ↑
EBITDA	Rs. 20.00 crores	Rs. 19.00 crores	5% ↑
EBITDA Margin	16.80%	18.30%	150 bps ↓
Profit After Tax	Rs. 9.00 crores	Rs. 8.00 crores	16% ↑
PAT Margin	7.20%	7.70%	50 bps ↓

For H1 FY26, OCCL Limited reported a total income of Rs. 244.00 crores, with an EBITDA of Rs. 47.00 crores and margins of 19.20%.

Operational Performance

The company is currently operating at approximately 70% capacity utilization for insoluble sulphur production, while its sulphuric acid plant is running at full capacity. The total debt position as of September 2025 stood at Rs. 81.00 crores, including long-term debt of Rs. 26.50 crores.

Market Dynamics and Challenges

OCCL Limited faces a complex market environment characterized by both opportunities and challenges:

Anti-dumping Duties: The imposition of anti-dumping duties on imports from China and Japan has improved domestic realizations. However, the full benefit has been offset by rising raw material costs.
Raw Material Pressures: Benchmark sulphur costs have seen a steady uptrend, driven by tight supply and stronger demand, putting pressure on input costs across the industry.
U.S. Tariffs: The recent 50% tariff imposed by the United States on imports from India has impacted the company's margins on its U.S. exports.
Global Market Oversupply: The insoluble sulphur market remains stable, but global realizations are under pressure due to oversupply conditions.

Strategic Outlook

Despite near-term challenges, OCCL Limited remains optimistic about its growth trajectory:

Domestic Market Focus: The company aims to increase its domestic market share from the current 55% to 60-65%, leveraging the fast-growing Indian insoluble sulphur market.
Global Demand Growth: Management expects a 2-3% annual growth in global demand for insoluble sulphur.
Potential Anti-dumping Measures: The company is exploring the possibility of initiating anti-dumping measures against Malaysia if current pricing trends continue.
R&D and Operational Efficiency: OCCL Limited is focusing on its R&D foundation and cost-competitive manufacturing base to strengthen its market position.

Mr. Akshat Goenka, Joint Managing Director of OCCL Limited, commented, "While we expect near-term realizations to stay soft as supply currently exceeds demand, we remain confident in our ability to navigate the short-term challenges. We are hopeful that the U.S. tariff situation should get resolved soon."

The company's management remains committed to operational efficiency, product quality, and sustainability to deliver consistent value to stakeholders in the medium to long term.

Conclusion

OCCL Limited's Q2 FY26 results reflect the company's resilience in a challenging market environment. While revenue growth remains strong, margin pressures from rising raw material costs and international trade issues persist. The company's strategic focus on the domestic market and potential regulatory measures could provide support in the coming quarters. Investors should monitor global sulphur prices, the resolution of U.S. tariffs, and the potential for new anti-dumping measures as key factors influencing the company's performance in the near term.

1 Day	5 Days	1 Month	6 Months	1 Year	5 Years
+0.26%	-3.94%	-13.34%	+5.01%	+9.04%	+6.87%

OCCL Limited, a leading producer of Insoluble Sulphur for the tyre and rubber industry, has reported a 16% year-on-year increase in net profit for the second quarter. The company's financial performance shows resilience amid economic challenges, with improvements in revenue and profitability.

Financial Highlights

Metric	Q2 FY2026	Q2 FY2025	YoY Change
Revenue	₹1,196.43	₹1,030.63	+16%
EBITDA	₹192.07	₹185.02	+3.8%
EBITDA Margin	16.07%	17.96%	-189 bps
Net Profit	₹87.00	₹75.00	+16%

OCCL's revenue for Q2 FY2026 stood at ₹1,196.43 crore, marking a 16% increase from ₹1,030.63 crore in the same quarter last year. The company's EBITDA rose to ₹192.07 crore, up from ₹185.02 crore in Q2 FY2025, representing a 3.8% growth. However, the EBITDA margin experienced a slight decline, dropping to 16.07% from 17.96% in the previous year.

Interim Dividend Declared

The Board of Directors has declared an interim dividend of ₹1 per equity share (face value of ₹2 each) for the financial year 2025-2026. The record date for determining shareholder eligibility has been set as November 7, 2025, with the dividend payout scheduled on or after November 20, 2025.

Management Commentary

Arvind Goenka, Promoter and Managing Director of OCCL Limited, commented on the results: "Revenue stood at ₹121 crore, up 16% year-on-year, while EBITDA grew by 5% to ₹20 crore, leading to an EBITDA margin of 16.8%. Our PAT grew by 16% year-on-year to ₹8.7 crore, underscoring our focus on profitable growth."

Goenka highlighted that the quarter included a one-time duty expense of about ₹32 crore related to the demerger. He also noted that domestic sales realization has improved following the imposition of anti-dumping duties on China and Japan, although margins have been impacted by the economic slowdown.

Sustainability Initiatives

OCCL continues to prioritize sustainability in its operations. The company has made significant progress in enhancing its renewable energy contribution, surpassing its green energy consumption targets. This transition is expected to improve cost competitiveness while reinforcing the company's commitment to environmental responsibility.

Market Outlook

The recent GST reduction on automobiles is anticipated to boost vehicle sales across segments, potentially increasing tyre production and, consequently, the demand for insoluble Sulphur in India. OCCL, as a key supplier to the tyre industry, is well-positioned to benefit from this positive momentum.

However, the management remains cautious about potential challenges, including further increases in sulphur prices and the imposition of a 50% import duty by the USA.

Conclusion

Despite facing economic headwinds, OCCL Limited has demonstrated resilience in its Q2 FY2026 performance. The company's focus on operational efficiency, product quality, and sustainability initiatives, coupled with favorable market conditions following anti-dumping duties, positions it well for future growth. Investors and stakeholders will be watching closely to see how OCCL navigates the evolving market landscape and capitalizes on emerging opportunities in the coming quarters.