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

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.

OCCL Limited , a leading manufacturer of insoluble sulphur and sulphuric acid, has reported a strong start to the fiscal year, with significant growth in both revenue and profitability for the first quarter.

Financial Highlights

• Revenue stood at INR 123.00 crores, marking a 14% increase from the previous quarter
• EBITDA grew by 36% to INR 27.00 crores
• EBITDA margins improved to 21.70% from 18.10% in the previous quarter
• Profit After Tax (PAT) reached INR 13.00 crores, with PAT margins at 10.60%

Key Drivers of Growth

The company's growth was primarily attributed to increased sulphuric acid margins, which benefited from elevated sulphur prices. OCCL Limited operates at 100% capacity utilization for sulphuric acid production, allowing it to capitalize on favorable market conditions.

Anti-Dumping Duties and Market Share

In June, anti-dumping duties were imposed on insoluble sulphur imports from Japan and China. While the full impact of these duties was not reflected in the Q1 results, OCCL Limited expects to see benefits in future quarters. The company estimates a monthly benefit of INR 70.00-80.00 lakhs at the Profit Before Tax (PBT) level due to these measures.

OCCL Limited currently holds a 55% domestic market share in insoluble sulphur and anticipates this to exceed 60% following the implementation of anti-dumping measures. However, the company noted that imports from Malaysia continue without price increases, which may limit the full benefit of the anti-dumping duties.

Operational Performance

• Insoluble Sulphur: Operating at 70% capacity utilization
• Sulphuric Acid: Operating at 100% capacity utilization

Strategic Focus

OCCL Limited is concentrating on several key areas to drive future growth and maintain its competitive edge:

1. Product Innovation: Continuous improvement in product quality, with a focus on enhancing dispersion and thermal stability for next-generation tyres
2. Cost Optimization: Implementing measures to improve operational efficiency
3. Sustainability Initiatives: Adopting renewable energy solutions, including rooftop solar power generation at both plants and a contracted 3.2 megawatt captive power plant for the Dharuhera facility

Market Outlook

While the insoluble sulphur market continues to see stable demand with steady year-on-year growth, global realizations remain weak due to oversupply. However, OCCL Limited remains confident in navigating these challenges, citing the long-term structural growth in the global tyre industry and rising demand for high-performance, environment-compliant products.

Management Commentary

Akshat Goenka, Joint Managing Director of OCCL Limited, stated, "We have started the fiscal year on a positive note. With the recent imposition of anti-dumping duties on imports from Japan and China, there will be improvement in the domestic market realization. We have been able to pass on some of these anti-dumping benefits in this July quarter to our customers and we hope to pass on the balance in the upcoming quarters."

OCCL Limited's strong performance in Q1, coupled with its strategic initiatives and favorable market conditions, positions the company well for continued growth in the coming quarters. The management remains focused on leveraging its operational strengths and market opportunities to deliver value to its shareholders.