Sudarshan Chemical Industries Limited has approved its unaudited financial results for Q3FY26, demonstrating mixed performance across standalone and consolidated operations. The Board of Directors approved these results at their meeting held on February 12, 2026, for the quarter and nine months ended December 31, 2025.

Standalone Financial Performance

The company's standalone operations showed resilience with improved profitability despite revenue decline. Key performance metrics for Q3FY26 are presented below:

For the nine months ended December 31, 2025, standalone revenue reached ₹1,664.0 crore compared to ₹1,830.4 crore in the previous year, while net profit increased significantly to ₹169.9 crore from ₹118.6 crore.

Consolidated Financial Results

The consolidated performance reflects the substantial impact of the Heubach acquisition completed in March 2025. The consolidated financial metrics demonstrate:

The consolidated nine-month revenue reached ₹6,987.3 crore compared to ₹1,996.1 crore in the previous year, primarily driven by the Heubach acquisition integration.

Exceptional Items and Labour Code Impact

The company reported exceptional items expense of ₹26.5 crore in standalone results and ₹45.4 crore in consolidated results for Q3FY26. This primarily relates to the statutory impact of new Labour Codes notified by the Government of India on November 21, 2025, affecting gratuity calculations due to changes in wage definition. The incremental impact consists of gratuity of ₹43.2 crore and long-term compensated absences of ₹3.1 crore in consolidated results.

Segment Performance Analysis

The pigments segment, forming the core business operations, generated substantial revenue growth:

Corporate Developments and Approvals

Several significant corporate actions were completed during the period:

The Board approved renewal of corporate guarantee to The Hongkong and Shanghai Banking Corporation Limited for EURO 6 million on behalf of Sudarshan Europe B.V., the company's wholly owned subsidiary, for securing revolving credit facility. The company also made multiple allotments of employee stock options under the Sudarshan Employee Stock Option Plan, 2018, with total allotments of 39,051 options during the financial year.

Sudarshan Chemical Industries Limited has received a GST demand order from Tamil Nadu tax authorities totaling ₹59.42 lakh for the financial year 2021-22. The company disclosed this development on December 31, 2025, in compliance with SEBI listing regulations.

GST Order Details

The Deputy Commissioner of State Tax, Valasaravakkam, Chennai-South, Tamil Nadu, issued the GST DRC-07 order dated December 31, 2025. The demand covers the audit period from April 1, 2021, to March 31, 2022.

Audit Process and Company Response

The tax demand emerged following completion of audit by Tamil Nadu tax authorities for FY22. The process involved multiple stages:

• Tax authorities completed audit for the specified period
• Office of Deputy Commissioner issued initial notice in Form DRC 01
• Company submitted detailed response to the notice
• After verification of company's response, authorities issued final order in Form DRC 07

Company's Position and Next Steps

Sudarshan Chemical Industries maintains confidence in its position regarding the tax demand. The company stated it "believes that it has a good case on all the points raised by the Office of Deputy Commissioner, State Tax, Tamil Nadu."

The company plans to challenge the order through proper legal channels. As the order is appealable, Sudarshan Chemical is currently preparing to file an appeal before the appropriate authority.

Expected Impact Assessment

Regarding potential business implications, the company expressed optimism about the outcome. Management believes there will be no material impact on the company's financial position, operations, or other business activities due to this GST order.

The disclosure was made pursuant to Regulation 30 of SEBI Listing Regulations, 2015, ensuring transparency with stakeholders about regulatory developments affecting the company.