Yasho Industries Limited , a prominent manufacturer and supplier of specialty chemicals, has announced a significant long-term agreement with a leading global multinational corporation (MNC) for the supply of lubricant additives. The 15-year deal, valued at approximately ₹150.00 crore annually, marks a major milestone for the company and promises to provide a stable revenue stream over the contract period.

Key Details of the Agreement

Strategic Implications

The long-term nature of this agreement offers Yasho Industries several strategic advantages:

1. Business Stability: The 15-year contract duration provides a predictable revenue stream, enhancing the company's financial stability.
2. Global Recognition: Partnering with a leading MNC reinforces Yasho Industries' position as a reliable supplier in the global specialty chemicals market.
3. Capacity Expansion: The company will be setting up a new facility at Pakhajan to fulfill this contract, indicating growth and expansion.

Financial Arrangements

• Yasho Industries will receive an advance to build the required facility.
• The sales price will be based on an agreed-upon formula with the customer.
• The company expects to set up the facility within the next 12 to 18 months.

Management's Perspective

Mr. Parag Jhaveri, Managing Director & CEO of Yasho Industries Limited, expressed his enthusiasm about the deal, stating, "The execution of this agreement marks a significant milestone for our Company. It underscores the confidence that global customers place in our capabilities, reliability, and quality standards. With this partnership, we are strengthening our growth pipeline and securing long-term business visibility and sustainability."

Company Background

Yasho Industries Limited is known for its expertise in manufacturing specialty chemicals, with a strong focus on exports. The company has:

• Over 30 years of industry experience in its management team
• ISO 9001:2015 & FSSC 22000 certifications
• A global customer base spanning more than 50 countries
• Four well-equipped manufacturing units located in Vapi and Pakhajan

This new agreement further solidifies Yasho Industries' position in the global specialty chemicals market and sets the stage for sustained growth in the coming years.

Yasho Industries Limited, a leading specialty chemicals manufacturer, has reported its highest-ever quarterly revenue of INR 198.60 crores for Q1, marking a 14% year-on-year growth. The company's performance was driven by a robust 33% volume growth, despite facing challenges in the pricing environment.

Segment-wise Performance

The Industrial Chemicals segment contributed 87% of the total revenue, while Consumer Chemicals accounted for the remaining 13%. Yasho Industries maintained healthy EBITDA margins of 18.01% on a standalone basis and 17.02% on a consolidated basis.

Operational Highlights

The Pakhajan facility operated at over 50% utilization during the quarter. The company is actively working to enhance utilization levels through deeper customer engagement and potential collaborations with global partners.

Capex and R&D Initiatives

Out of the planned annual capex of INR 100.00 crores for FY26, Yasho Industries has already incurred INR 30.00 crores. The company has allocated INR 75.00 crores for capacity expansion and INR 25.00 crores for completing its R&D facility by October 2025. The state-of-the-art R&D laboratory is expected to strengthen the company's product development capabilities and position it well for future opportunities in Performance Chemicals.

Financial Outlook and Strategy

Yasho Industries aims to improve its Return on Capital Employed (ROCE) and reduce its debt-to-EBITDA ratio through better capacity utilization and working capital optimization. The company plans to reduce its net working capital from 190 days to below 150 days by optimizing raw material and finished goods inventory.

Market Expansion and Growth Targets

With a growing customer base and continued operational ramp-up, Yasho Industries remains confident of delivering over 40% revenue growth in FY26. The company expects export markets to contribute 70% of total revenue going forward, with the U.S. market currently representing 25% of revenue.

Industry Challenges and Opportunities

The chemical industry is currently navigating a phase of policy uncertainty, particularly regarding tariffs and trade. This has led to temporary delays in order finalization, especially in industrial and auto ancillary segments. However, Yasho Industries believes this disruption is short-term and anticipates greater clarity in the coming months.

Management Commentary

Parag Jhaveri, Managing Director and CEO of Yasho Industries, stated, "We began this financial year on a strong note, delivering the highest ever quarterly revenue of our company at INR 198.60 crores. This marks a 14% year-on-year growth achieved despite a challenging global macroeconomic environment. What's even more encouraging is the 33% growth in volumes, underscoring the robustness of our operations and continued trust of our customers."

Yasho Industries remains focused on sustainable value creation for all stakeholders while navigating the current market challenges and capitalizing on growth opportunities in the specialty chemicals sector.