Any current/future new fundraising through debt or equity?

No specific announcement of new fundraising through debt or equity in the near term. Borrowings are expected to remain around Rs. 800 crore. Temporary increase in debt is possible in the next 3-6 months due to higher inventory for supply security. Long-term target is to reduce debt by approximately 10% each year after the interim increase. Capex for FY27 is projected at around Rs. 140 crore, mostly front-ended in the first two quarters. No mention of fresh equity fundraising plans; focus remains on managing operational and capex funding through internal accruals and controlled borrowings.

Any current/future capex/capital investment/strategic investment?

FY27 capex is expected to be around Rs. 140 crore, mostly front-ended in the first two quarters. Almere factory (Netherlands) is fully operational, supporting European growth by debottlenecking capacity constraints. Vanavate facility in Maharashtra expected to come on stream in the coming months, with the transition between factories happening over the next 6-12 months. Rebuilding of the Vashivali factory is underway after a fire incident, adding to capex needs. Three new development centers (Germany, Manchester UK, and US), with combined annual operating costs of Rs. 80-85 crore, are

Future growth expectations in sales/revenue/volumes?

European business expected to grow rapidly with new factory capacity enabling double-digit growth in next few years. (Page 12) India and Asia markets to continue steady growth, with strong demand in India and Middle East. (Pages 10-12) Middle East and APAC regions expected to provide 3-4 years of rapid revenue growth. (Page 12) UK and US markets are longer-term growth drivers (3-4 years to ramp up), with large market opportunities. (Page 12) Inflationary environments benefit market share gains; demand may be muted overall but company expects normal growth through share gains. (Page 15) Confide

Future growth expectations in earnings/operating earnings/profits/EPS?

Confident to achieve Rs. 300 crore+ EBITDA for FY2027, at least matching or exceeding FY2025 levels. Adjusted EBITDA margin expected to stabilize around 13%-14% in the near term, with efforts to maintain low double-digit margins despite inflation. Demand expected to be muted industry-wide, but company aims for normal growth through market share gains. Focus on portfolio optimization to exit low or negative margin businesses (~Rs. 50 crore exited) without hurting overall growth. Growth drivers: mature steady businesses in India, expanding markets in Middle East and Southeast Asia, and l

Current/ Expected Orderbook/ Pending Orders?

The company has a secure order book for the next six months, supported by price increases and supply contracts, especially for Q1 and Q2 of FY27. They have adequate raw material inventory to ensure supply continuity and margin maintenance. Due to inflation and supply chain volatility, they have a robust system to monitor orders and pricing, communicating frequently with clients. There is strong demand and good win rates for product range developments, indicating a healthy pending order pipeline. The ongoing portfolio optimization has led to exiting around Rs. 50 crore of low-margin business bu

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S H Kelkar & Company LtdQ1 FY26Chemicals & Petrochemicals

S H Kelkar & Company Ltd Q1 FY26 Earnings Call Analysis

Revenue, margin, capex, fundraise and order book outlook from management commentary.

Price: ₹135P/E: 38.1Market Cap: ₹1.9K CrSector: Chemicals & Petrochemicals

Management growth scorecard

Revenue

Category 3

Margin

Category 3

Fundraise

Yes

Order

N/A

Capex

Yes

2 of 4 growth signals are positive.

Full analysis

Revenue guidance

Category 3

→European business expected to grow rapidly with new factory capacity enabling double-digit growth in next few years. (Page 12)
→India and Asia markets to continue steady growth, with strong demand in India and Middle East. (Pages 10-12)
→Middle East and APAC regions expected to provide 3-4 years of rapid revenue growth. (Page 12)
→UK and US markets are longer-term growth drivers (3-4 years to ramp up), with large market opportunities. (Page 12)
→Inflationary environments benefit market share gains; demand may be muted overall but company expects normal growth through share gains. (Page 15)
→Confident of maintaining or surpassing FY2025 EBITDA levels in FY2027, indicating revenue growth support. (Page 15)
→Structural portfolio adjustments removing low-margin business (~Rs. 50 crore) will not impact overall growth. (Page 14)
→Continued strong demand and good win rates seen in recent quarters support growth outlook. (Page 15)

Margin guidance

Category 3

→Confident to achieve Rs. 300 crore+ EBITDA for FY2027, at least matching or exceeding FY2025 levels.
→Adjusted EBITDA margin expected to stabilize around 13%-14% in the near term, with efforts to maintain low double-digit margins despite inflation.
→Demand expected to be muted industry-wide, but company aims for normal growth through market share gains.
→Focus on portfolio optimization to exit low or negative margin businesses (~Rs. 50 crore exited) without hurting overall growth.
→Growth drivers: mature steady businesses in India, expanding markets in Middle East and Southeast Asia, and longer-term investments in Europe, UK, and US with expected ramp-up over 3-4 years.
→Longer-term EBITDA margin improvement from 10% (FY2026) to 14% by FY2029, though timing is uncertain due to dynamic environment.
→Capex of Rs. 140 crore planned for FY2027, supporting capacity expansion and growth.

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Fundraise plans

Yes

→No specific announcement of new fundraising through debt or equity in the near term.
→Borrowings are expected to remain around Rs. 800 crore.
→Temporary increase in debt is possible in the next 3-6 months due to higher inventory for supply security.
→Long-term target is to reduce debt by approximately 10% each year after the interim increase.
→Capex for FY27 is projected at around Rs. 140 crore, mostly front-ended in the first two quarters.
→No mention of fresh equity fundraising plans; focus remains on managing operational and capex funding through internal accruals and controlled borrowings.

Order book

→The company has a secure order book for the next six months, supported by price increases and supply contracts, especially for Q1 and Q2 of FY27.
→They have adequate raw material inventory to ensure supply continuity and margin maintenance.
→Due to inflation and supply chain volatility, they have a robust system to monitor orders and pricing, communicating frequently with clients.
→There is strong demand and good win rates for product range developments, indicating a healthy pending order pipeline.
→The ongoing portfolio optimization has led to exiting around Rs. 50 crore of low-margin business but is not expected to negatively impact overall growth or order inflow.
→Transition of factories and capacity expansions in Europe and India are expected to support increased order execution and volume ramp-up in the coming quarters.

Capex plans

Yes

→FY27 capex is expected to be around Rs. 140 crore, mostly front-ended in the first two quarters.
→Almere factory (Netherlands) is fully operational, supporting European growth by debottlenecking capacity constraints.
→Vanavate facility in Maharashtra expected to come on stream in the coming months, with the transition between factories happening over the next 6-12 months.
→Rebuilding of the Vashivali factory is underway after a fire incident, adding to capex needs.
→Three new development centers (Germany, Manchester UK, and US), with combined annual operating costs of Rs. 80-85 crore, are ongoing strategic investments expected to breakeven after 3-4 years.
→No large capex planned in India beyond these, focus is on international expansion and capacity additions to support ramp-up in multiple geographies.
→Long-term focus on innovation centers and factories to strengthen the global footprint and enhance product development capabilities.

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