Tarsons Products Limited , a leading Indian manufacturer of plastic labware, has reported a mixed set of results for the first quarter, reflecting both growth and challenges in the current market environment.

Revenue Growth

The company's standalone revenue from operations stood at ₹71.00 crores, marking a 10% year-on-year growth. On a consolidated basis, revenue reached ₹91.00 crores, up 8% compared to the same period last year. The domestic business showed strong performance with a 12% year-on-year growth, while export revenue increased by 3%.

Profitability

Despite revenue growth, Tarsons faced pressure on its bottom line. Standalone profit after tax (PAT) declined to ₹3.60 crores from ₹6.50 crores in the previous year. Consolidated PAT stood at ₹1.80 crores, down from ₹4.00 crores. The company attributed this decline primarily to higher depreciation expenses of ₹17.80 crores, up from ₹9.00 crores, due to the capitalization of its new Panchla facility.

EBITDA Performance

On a more positive note, standalone EBITDA improved to ₹22.00 crores, reflecting a growth of around 31% year-on-year. The EBITDA margin expanded to 31.2% from 26.3% in the same quarter last year. Consolidated EBITDA stood at ₹25.00 crores with a margin of 27%.

Operational Highlights

Tarsons has commenced Phase 1 of commercial production at its new Panchla facility. The company expects Phase 2 to begin operations in the second half of the fiscal year. Initial revenue contribution from cell culture products is anticipated in Q4.

Market Challenges and Opportunities

The plastic labware industry has experienced moderation in growth momentum over the past 18-24 months. While the overseas market remains soft, Tarsons reported seeing green shoots of recovery in the domestic market. The company is optimistic about translating increasing inquiries into business growth.

International Business

Nerbe, Tarsons' Germany-based subsidiary, reported flat revenue growth due to budget constraints and delays in spending across several European countries. The company is working on introducing Tarsons-manufactured products through Nerbe's distribution network to unlock cross-selling opportunities.

Future Outlook

Tarsons remains cautiously optimistic about its future prospects. The company is closely monitoring the impact of potential U.S. tariffs on Indian imports, which could affect up to 10-12% of its consolidated revenues. Management emphasized the need for a flexible strategy to navigate the evolving international trade landscape.

Aryan Sehgal, Promoter and Whole-Time Director of Tarsons Products Limited, commented, "While we continue to navigate near-term headwinds, our confidence in the long-term growth potential of the plastic labware industry remains firmly intact. Our capital expenditure program is nearing completion and will significantly enhance our production capabilities."

As Tarsons Products Limited adapts to the changing market dynamics, it remains focused on expanding its product portfolio, strengthening its presence in both domestic and international markets, and maintaining operational efficiency to drive sustainable growth in the coming years.

Tarsons Products Limited , a leading Indian manufacturer of labware products, has announced its financial results for the first quarter. The company reported a mixed performance, with revenue growth accompanied by a decline in profitability.

Revenue Growth

On a consolidated basis, Tarsons Products saw its revenue from operations increase by 7.7% year-over-year, reaching ₹913.64 crore. The standalone entity performed even better, with a 9.9% year-over-year growth, recording revenue of ₹712.79 crore.

The domestic market showed particular strength, with standalone domestic revenue growing by 12.3% compared to the same quarter last year. This growth suggests an early sign of recovery in the life sciences industry and Tarsons Products' ability to capture increased market share.

Profitability Challenges

Despite the revenue growth, the company faced challenges in maintaining profitability. On a consolidated basis, net profit stood at ₹17.83 crore, down from ₹40.16 crore in the previous year's quarter. The standalone results showed a similar trend, with net profit at ₹35.70 crore compared to ₹64.61 crore in the same period last year.

Operational Highlights

Impact of New Facility

The company's profitability was primarily impacted by the capitalization of its upcoming facility at Panchla, resulting in higher depreciation. While this affected the current quarter's results, the company expects to benefit from strong operating leverage as revenue contribution from this plant ramps up in the coming periods.

Management Commentary

Aryan Sehgal, Promoter and Whole-time Director of Tarsons Products, commented on the results: "We are pleased to report a year-on-year revenue growth of 10% and an EBITDA growth of 31% on a standalone basis. While these signs of revival remain somewhat volatile, the current order pipeline and ongoing customer inquiries give us confidence in sustaining growth."

Future Outlook

Tarsons Products remains optimistic about its growth prospects. The company is positioned to address a broader market with the addition of new product categories enabled by the commissioning of its new facility at Panchla. Management expressed confidence in achieving similar market share in these new categories as they currently command for their existing product portfolio.

Annual General Meeting

The Board of Directors has scheduled the 42nd Annual General Meeting (AGM) for September 22, to be held via video conferencing. The cut-off date for e-voting has been set as September 12.

Conclusion

While Tarsons Products faces short-term profitability challenges due to its expansion efforts, the company's revenue growth and positive outlook for the life sciences industry suggest potential for improved performance in the coming quarters. Investors and stakeholders will be watching closely to see how the new facility at Panchla contributes to the company's growth and profitability in the future.