S H Kelkar and Company Ltd — Q4 FY26 earnings call
Summary generated by AI from the official transcript S H Kelkar and Company Ltd filed with BSE on 21 May 2026. Every statement cites a verbatim quote from that document — open any citation to read it. This is a record of what management said, not a recommendation. How we check these summaries
The short read
S H Kelkar reported Q4 FY26 adjusted EBITDA of Rs. 83 crore with margins at 13.5%, including a one-off sale of approximately Rs. 35 crore of low-margin products as part of a portfolio optimization exercise. Management said raw material prices, particularly linked to crude derivatives, have been rising due to geopolitical developments in the Middle East, and that gross margins for the quarter were 42.3% net of the one-off. The company also discussed capacity additions including the Almere facility in the Netherlands and the upcoming Vanavate facility in Maharashtra, along with rising employee costs and depreciation during the year.
Numbers mentioned
Adjusted EBITDA: Rs. 83 crores (Q4 FY26)
p. 4
“From a profitability perspective, adjusted EBITDA stood at Rs. 83 crores, with margins at 13.5%, remaining steady on a sequential basis.”
Jagdish Agrawal, page 4 of the filed PDF · View the filing
One-off low-margin sale: approximately INR 35 crores (Q4 FY26)
p. 3
“You would have noticed that during the quarter, we reported a one-off sale of approximately INR 35 crores of low-margin products as part of our ongoing portfolio optimization exercise.”
Jagdish Agrawal, page 3 of the filed PDF · View the filing
Gross margin: 42.3% (Q4 FY26)
p. 14
“but 42.3% net of one-off we have maintained in the quarter four.”
Kedar Vaze, page 14 of the filed PDF · View the filing
Gross debt: Rs. 851 crore (as of end of March)
p. 12
“Gross debt end of March we had a Rs. 851 crore and temporarily we do see that it is going to go up a little bit because we are just ensuring a supply security”
Jagdish Agarwal, page 12 of the filed PDF · View the filing
Cash conversion cycle: around 140 days (current)
p. 13
“So, the cash conversion cycle is around 140 days at the moment.”
Kedar Vaze, page 13 of the filed PDF · View the filing
Raw material linked to crude: about 40% directly, another 30% indirectly
p. 9
“So about I would say 40% is directly linked to the crude and another 30% are indirectly linked to the crude in some part.”
Kedar Vaze, page 9 of the filed PDF · View the filing
Employee cost: Rs. 94 to Rs. 95 crore quarterly (quarterly)
p. 13
“Our normal employee cost in the range of Rs. 94 to Rs. 95 crore on a quarterly basis at this point of time”
Jagdish Agarwal, page 13 of the filed PDF · View the filing
FX contribution to revenue growth: 3% to 3.5% (Q4 FY26 and FY26)
p. 10
“So, it is in the range of 3% Abhijit when we look at either in quarter or in the full year.”
Jagdish Agarwal, page 10 of the filed PDF · View the filing
Netherlands production site sales: about 10 million (last year)
p. 8
“We have roughly closed the year last year with about 10 million of sales in the Netherlands production site or sale, and then we move this to the new facility.”
Kedar Vaze, page 8 of the filed PDF · View the filing
What management said it would do
A record of statements made on the call, in the words management used. Parakho does not forecast, endorse or assess them, and their presence here is not a view on whether they will happen.
Gross margin — 42% and thereabout · first half of the year
stated conditionally by Kedar Vaze
p. 14
“We will see that the margin continues to be under pressure, but we will be able to maintain 42% and thereabout for the first half of the year.”
Kedar Vaze, page 14 of the filed PDF · View the filing
Adjusted EBITDA margin — 13.5%, 14% · first half of the year
stated conditionally by Kedar Vaze
p. 11
“We would be upwards of 13.5%, 14% adjusted EBITDA in a normal environment.”
Kedar Vaze, page 11 of the filed PDF · View the filing
Minimum EBITDA level — 12%, 13% EBITDA level
stated firmly by Kedar Vaze
p. 11
“we will wait and watch and see and take corrective steps as necessary to ensure that we do not fall below the 12%, 13% EBITDA level which we want to keep as a minimum.”
Kedar Vaze, page 11 of the filed PDF · View the filing
FY27 capex — around Rs. 140 crore · FY27
stated firmly by Kedar Vaze
p. 12
“FY27 capex will be around Rs. 140 crore of capex.”
Kedar Vaze, page 12 of the filed PDF · View the filing
Borrowings — around the Rs. 800 crore mark · FY27
stated firmly by Kedar Vaze
p. 13
“Borrowing should remain around the Rs. 800 crore mark.”
Kedar Vaze, page 13 of the filed PDF · View the filing
Debt reduction — 10% per year
stated as an aspiration by Jagdish Agarwal
p. 12
“But when you look at a long-term horizon for sure that we are expecting every passing year we should reduce our debt by 10%.”
Jagdish Agarwal, page 12 of the filed PDF · View the filing
Reported EBITDA margin — 14% · by end of FY29
stated conditionally by Jagdish Agarwal
p. 13
“We have stated that our reported EBITDA which is a 10% is going to be 14% by end of FY29.”
Jagdish Agarwal, page 13 of the filed PDF · View the filing
Consolidated EBITDA — Rs. 300 crore plus · this year
stated conditionally by Kedar Vaze
p. 15
“I am actually confident that we will hit the Rs. 300 crore plus EBITDA for this year.”
Kedar Vaze, page 15 of the filed PDF · View the filing
US organic business break-even — roughly 4 years or earlier
stated as an aspiration by Kedar Vaze
p. 7
“On an organic strategy, what we are investing in the US, we will have a break-even of roughly 4 years or earlier.”
Kedar Vaze, page 7 of the filed PDF · View the filing
Vashivali facility commissioning — third quarter of this year
stated conditionally by Kedar Vaze
p. 17
“We have basically we are we have restarted the building. So anytime this year, probably third quarter of this year that facility will be available.”
Kedar Vaze, page 17 of the filed PDF · View the filing
Q&A highlights
Management's answers to analyst questions, in Parakho's words rather than a transcript. Each row names who answered and carries the verbatim quote it was drawn from.
Management said the combined investment across the three centres is roughly Rs. 80-85 crore annually, describing it as investment rather than losses.
Answered by Jagdish Agrawal
Asked by Riddhesh Ram Gandhi: How much are the operating losses being borne in the new Development Centres?
p. 5
“It is roughly when you look at all these three combined in the range of Rs. 80 crore to Rs. 85 crore annually.”
Jagdish Agrawal, page 5 of the filed PDF · View the filing
Management confirmed expectation of reaching that level quickly.
Answered by Kedar Vaze
Asked by Riddhesh Ram Gandhi: Will margins normalize toward low teens this year?
p. 6
“Yes, I think we will reach there quickly.”
Kedar Vaze, page 6 of the filed PDF · View the filing
Management said adjusted EBITDA net of one-off sales was 13.5% in Q4 and this is the level they expect to sustain in normal conditions.
Answered by Kedar Vaze
Asked by Debanjana Chatterjee: What would EBITDA margin have looked like absent the inflation-driven disturbance?
p. 11
“I am talking about the fourth quarter this year which with the one-off sales if we adjust for the one-off sales, we are 13.5% in EBITDA and that is what we expect going forward.”
Kedar Vaze, page 11 of the filed PDF · View the filing
Management attributed the increase partly to a one-off mark-to-market impact and a reclassification from other expenses to depreciation.
Answered by Jagdish Agarwal
Asked by Jatin Chawla: Why have employee costs and depreciation continued to rise despite prior comments that CDC investments were largely done?
p. 13
“When you look at employee cost on a sequential quarter basis, 93 has gone to 101 and in March quarter we had a one-off impact on a MTM which came into our trust, so around Rs. 6 crore is a one-off impact we have in the March quarter.”
Jagdish Agarwal, page 13 of the filed PDF · View the filing
Management said the plan stands but priorities have shifted given the changed environment since early March.
Answered by Jagdish Agarwal
Asked by Jatin Chawla: Has the promised detailed plan for EBITDA margin expansion from 13% to 17% been delayed?
p. 13
“I think in last investor call we talk about our three-year outlook. We have stated that our reported EBITDA which is a 10% is going to be 14% by end of FY29.”
Jagdish Agarwal, page 13 of the filed PDF · View the filing
Management said they believe they gained market share in the Indian market in the early weeks of the quarter due to more calibrated pricing versus smaller players.
Answered by Kedar Vaze
Asked by Rohit Nagraj: Has S H Kelkar gained market share from smaller competitors amid raw material volatility?
p. 15
“I think first few weeks of this quarter also we believe that we have gained market share in the Indian market especially.”
Kedar Vaze, page 15 of the filed PDF · View the filing
Management said they do not expect any significant further quantum but will continue monitoring and passing on costs.
Answered by Kedar Vaze
Asked by Bharat Sheth: Is there further room for portfolio optimization beyond the Rs. 35 crore already exited?
p. 16
“So, I mean we are not expecting any significant quantum.”
Kedar Vaze, page 16 of the filed PDF · View the filing
Risks flagged
Raw material price inflation linked to Middle East geopolitical developments
p. 4
“the operating environment remains dynamic, with raw material prices witnessing an increase due to geopolitical developments in the Middle East and evolving supply-side conditions.”
Jagdish Agrawal, page 4 of the filed PDF · View the filing
Higher effective tax rate from losses in subsidiaries impacting PAT
p. 4
“PAT performance during the year was impacted by a higher effective tax rate at the consolidated level, reflecting the impact of losses in few subsidiaries.”
Jagdish Agrawal, page 4 of the filed PDF · View the filing
Temporary inventory build-up and increased borrowing due to supply security measures
p. 4
“This approach may temporarily result in some inventory build-up and a short-term increase in borrowing levels.”
Jagdish Agrawal, page 4 of the filed PDF · View the filing
Fire incident requiring re-investment in Indian capex
p. 5
“unfortunately, due to the fire incident, we had to do substantial re-look and re-investment in the Indian capex.”
Kedar Vaze, page 5 of the filed PDF · View the filing
Uncertainty beyond first half due to raw material and inflation outlook
p. 6
“I think, beyond the first half, it is very difficult to give a certain view of where the market is headed or what is the net results on the inflation and the growth rate that we can assume.”
Kedar Vaze, page 6 of the filed PDF · View the filing
Dollar loan creating translation impact from rupee depreciation
p. 10
“We do see some pressure on the margin because we do have a dollar loan into our books and that will have a translation impact.”
Jagdish Agarwal, page 10 of the filed PDF · View the filing
Muted overall industry demand due to inflation
p. 15
“I think yes, overall demand will be muted.”
Kedar Vaze, page 15 of the filed PDF · View the filing
India volume drop due to Middle East shipment delays and uncertainty in March
p. 9
“There have been some delays in shipments going to Middle East and some uncertainty which came in month of March, which sees the India business slight volume drop.”
Kedar Vaze, page 9 of the filed PDF · View the filing
Generated by claude-sonnet-5. Source: the transcript as filed with BSE. We link to the exchange's copy; we do not host transcripts. Parakho is a data and screening tool, not an investment adviser — nothing here is a recommendation to buy, sell or hold.