Sudarshan Chemical Industries Ltd — Q1 FY27 earnings call
Summary generated by AI from the official transcript Sudarshan Chemical Industries Ltd filed with BSE on 20 Aug 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
Sudarshan Chemical reported Q1 FY2027 consolidated revenue of Rs.2642 Crores with business EBITDA of Rs.247 Crores and reported EBITDA of Rs.266 Crores, up around 60% year-on-year. The acquired Heubach group posted reported EBITDA of Rs.146 Crores and business EBITDA of Rs.128 Crores, while net debt was reduced to Rs.531 Crores from a peak of Rs.922 Crores. Management maintained its FY2027 guidance of EUR 700 million turnover and EUR 35 million EBITDA for the acquired group without revision, citing the ongoing geopolitical situation.
2 statements from this call are not shown because their supporting quotes could not be reproduced within our quoting limits. Nothing shown here is affected: every statement on this page carries its verified quote.
Numbers mentioned
Revenue: Rs.2600 plus Crores (Q1 FY2027)
p. 5
“we started this year with a strong Q1 with a revenue of Rs.2600 plus Crores and with a business EBITDA of Rs.257 Crores”
Nilkanth Natu, page 5 of the filed PDF · View the filing
Reported EBITDA (acquired group): Rs.146 Crores (Q1 FY2027)
p. 5
“reported EBITDA for the acquired group for the quarter under consideration is Rs.146 Crores and the inventoried overhead impact due to increase in inventory is Rs.18 Crores and so the EBITDA number is Rs.128 Crores”
Nilkanth Natu, page 5 of the filed PDF · View the filing
RIECO revenue: Rs.38 Crores (Q1 FY2027)
p. 5
“The revenue from operations is at Rs. 38 Crores”
Nilkanth Natu, page 5 of the filed PDF · View the filing
Revenue (One Sudarshan): Rs.2642 Crores (Q1 FY2027)
p. 6
“the revenue from operations is Rs.2642 Crores with the business EBITDA of Rs.247 Crores and the reported EBITDA of Rs.266 Crores for the quarter under review showing around 60% plus growth year-on-year and 5% in terms of the revenue”
Nilkanth Natu, page 6 of the filed PDF · View the filing
Earnings per share: Rs.12.3 per share (Q1 FY2027)
p. 6
“The earnings per share for the quarter, which is not annualized is Rs.12.3 per share, return on capital employed is at 22.7% and which is a very strong number”
Nilkanth Natu, page 6 of the filed PDF · View the filing
Net debt: Rs.531 Crores (as of Q1 FY2027)
p. 6
“we are at Rs.531 Crores and that gives us a good leverage ratio of 0.2 in terms of the debt-to-equity and net working capital on annualized number is at 23.6%”
Nilkanth Natu, page 6 of the filed PDF · View the filing
Pigment business EBITDA (One Sudarshan): Rs.275 Crores (Q1 FY2027)
p. 5
“as one Sudarshan delivered EBITDA for the pigment business of Rs.275 Crores”
Rajesh Rathi, page 5 of the filed PDF · View the filing
Net debt at acquisition peak: Rs.922 Crores
p. 4
“we have already been able to reduce the debt from the peak when we took over the business it was at Rs.922 Crores and we have brought this down in less than 18 months to Rs.531 Crores”
Rajesh Rathi, page 4 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.
Turnover (acquired group) — EUR 700 million · FY2027
stated firmly by Rajesh Rathi
p. 6
“we have given a turnover guidance of Eur 700 million and EBITDA of EUR 35 million for the acquired group”
Rajesh Rathi, page 6 of the filed PDF · View the filing
EBITDA (acquired group) — EUR 35 million · FY2027
stated firmly by Rajesh Rathi
p. 6
“we have given a turnover guidance of Eur 700 million and EBITDA of EUR 35 million for the acquired group”
Rajesh Rathi, page 6 of the filed PDF · View the filing
Guidance revision — FY2027
stated conditionally by Rajesh Rathi
p. 6
“Though the Q1 performance has been much stronger, currently we are not revising our guidelines given the geopolitical situation. We want to do a wait and watch situation and come back to and reconsider this after Q1.”
Rajesh Rathi, page 6 of the filed PDF · View the filing
Legacy Sudarshan growth rate — 12% to 13%
stated as an aspiration by Rajesh Rathi
p. 5
“I would say we should be able to continue a performance of in the region of 12% to 13% in that work mark figure from that perspective”
Rajesh Rathi, page 5 of the filed PDF · View the filing
Gross margin — 50% plus
stated as an aspiration by Rajesh Rathi
p. 8
“I would say that we should continue to be in the range of 50% plus of gross margin”
Rajesh Rathi, page 8 of the filed PDF · View the filing
EBITDA (overall aspiration) — seven times of what our EBITDA was in 2023
stated as an aspiration by Rajesh Rathi
p. 3
“What we aspire to be is really seven times of what our EBITDA was in 2023 and also reach a debt-free level and that is our aspiration going forward.”
Rajesh Rathi, page 3 of the filed PDF · View the filing
RIECO turnaround — positive number · before year end
stated conditionally by Amitabha Mukhopadhyay
p. 9
“We are confident that before the year end it will be posting a positive number that is the work that we are trying to do.”
Amitabha Mukhopadhyay, page 9 of the filed PDF · View the filing
Revenue target (projection) — Rs.12,000 Crores plus
stated as an aspiration by Rajesh Rathi
p. 14
“we could reach Rs.12,000 Crores plus”
Rajesh Rathi, page 14 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 inference of volume decline may not be accurate given the broad product range, noted 6% modest growth despite the geopolitical situation, and said confidence comes from value capture and recovering lost business.
Answered by Rajesh Rathi
Asked by Sanjesh Jain: Whether underlying volume declined this quarter after adjusting for currency and price increases, and what gives confidence in 20%+ growth guidance.
p. 7
“I would say that the inference that the volume as a decline may not be very accurate given a very broad spectrum of our product range.”
Rajesh Rathi, page 7 of the filed PDF · View the filing
Management said the growth would substantially come from cost reduction or value capture.
Answered by Rajesh Rathi
Asked by Sanjesh Jain: How much of the growth journey will be led by revenue growth versus value capture/cost efficiency.
p. 7
“Substantially, this would come from cost reduction or value capture.”
Rajesh Rathi, page 7 of the filed PDF · View the filing
Management said no new capex is needed for volume growth, with only moderate capex for select ROI-driven initiatives.
Answered by Rajesh Rathi
Asked by Sanjesh Jain: On capex requirements over the next 12-18 months.
p. 8
“From a volume perspective, we do not need any new capex we have enough capacities to grow on the numbers which we have indicated”
Rajesh Rathi, page 8 of the filed PDF · View the filing
Management said a small part of acquisition debt has been prepaid and repayment will accelerate as net debt improves, and RIECO faced execution challenges due to subcontractor labor issues but is expected to normalize.
Answered by Amitabha Mukhopadhyay
Asked by Ankur Periwal: Plans on debt repayment and RIECO hive-off.
p. 9
“As our net debt position is improving as visible in the presentation, we think we will be able to accelerate the payment of the acquisition debt.”
Amitabha Mukhopadhyay, page 9 of the filed PDF · View the filing
Management said the acquired business had historically achieved double-digit margins consistently and that the FY2029 guidance is not new.
Answered by Rajesh Rathi
Asked by Rohit Nagraj: Whether the acquired business can reach near-double-digit margins as implied by FY2029 guidance.
p. 9
“Historically they did do double digits always consistently”
Rajesh Rathi, page 9 of the filed PDF · View the filing
Management said price increases were only to pass through cost increases, and prices would only be reversed if raw material costs soften.
Answered by Rajesh Rathi
Asked by Rohit Nagraj: Whether recent price increases were fully absorbed and could be reversed if demand-supply changes.
p. 10
“So most of our price increases right now have been only to pass on whatever cost increases we have experienced.”
Rajesh Rathi, page 10 of the filed PDF · View the filing
Management said this was a planned rationalization of the group holding structure from the time of acquisition, with no business impact.
Answered by Amitabha Mukhopadhyay
Asked by Nitesh Dhoot: Rationale for acquiring the 70% stake in Sudarshan Colorants from overseas subsidiaries.
p. 10
“It is only within the group holding structure rationalization, which was planned earlier itself.”
Amitabha Mukhopadhyay, page 10 of the filed PDF · View the filing
Management said quantification was not yet possible and clarity is expected by the end of Q2.
Answered by Amitabha Mukhopadhyay
Asked by Nitesh Dhoot: Details on the employee restructuring program noted in the financial statements and whether it is built into FY2027 EBITDA guidance.
p. 11
“By the end of Q2 I think we should have clarity on the quantification of this.”
Amitabha Mukhopadhyay, page 11 of the filed PDF · View the filing
Management said results were solid with few one-offs but chose to wait and watch before revising guidance, to be revisited after Q2.
Answered by Rajesh Rathi
Asked by Rashmi Gohil: Whether Q1 revenue strength, which already exceeded the top end of FY2027 guidance, implies an upside revision to guidance.
p. 12
“as I said, given the current geopolitical situation, we want to do a wait-and-watch look at how Q2 comes out and hence we are not revising our guidelines currently.”
Rajesh Rathi, page 12 of the filed PDF · View the filing
Management said guidance does not imply 15% margins but rather high single digits or low double digits for the acquired group.
Answered by Rajesh Rathi
Asked by Rashmi Gohil: What is the phasing assumption for acquired group margin improvement and whether it can reach legacy Sudarshan margin levels.
p. 13
“For our guidance which we have been given, I do not think the guidance would be 15% but the area where we would want to look at how far the acquired group is in high single digits or low double digits.”
Rajesh Rathi, page 13 of the filed PDF · View the filing
Management pointed to slide nine of the investor deck projecting revenue reaching over Rs.12,000 Crores, citing opportunity to recapture lost business.
Answered by Rajesh Rathi
Asked by Viraj Mahadevia: Whether the combined entity could target more aggressive revenue growth given Heubach's former billion-euro scale.
p. 14
“Absolutely, Sir and that is where if you see a slide number nine, that is where I think we have done our projection on the investor deck from that perspective, where we said we could reach Rs.12,000 Crores plus.”
Rajesh Rathi, page 14 of the filed PDF · View the filing
Risks flagged
Energy cost spikes across Europe and India
p. 4
“We have faced energy cost spikes everywhere in Europe, in India, substantially where our substantial assets are based.”
Rajesh Rathi, page 4 of the filed PDF · View the filing
Increased raw material and logistics costs, and extended logistics cycle causing customer purchase delays
p. 4
“We have seen increase in raw material costs, logistic costs have increased, but more importantly this whole logistic cycle has increased by two weeks and because of so many uncertainties, many customers across industry have been kind of delaying their purchases”
Rajesh Rathi, page 4 of the filed PDF · View the filing
RIECO execution challenges from customer readiness delays and subcontracting manpower availability
p. 5
“we had faced challenges in the execution due to delays in the customer side readiness and also in some sites due to the subcontracting manpower availability and this reduction in the revenue has led to the EBITDA drop”
Nilkanth Natu, page 5 of the filed PDF · View the filing
Subdued coatings demand in US and Europe decorative and automotive markets
p. 11
“the current situation in US, both the decorative market, which is the house paint market and the automotive have been subdued and both in US and Europe perspective”
Rajesh Rathi, page 11 of the filed PDF · View the filing
Polymer price increases and hand-to-mouth supply situation in plastics due to geopolitical situation
p. 11
“given the whole geopolitical situation there has been a substantial increase in polymer prices and that is where I think our customers are running, the whole value chain has tied up they do not want to keep high cost inventories and, there is a hand to mouth kind of supply situation”
Rajesh Rathi, page 11 of the filed PDF · View the filing
Long-term decline in volume-driven printing inks due to digitalization
p. 11
“the volume driven printing ink has been a little bit on the decline market in general as a long-term trend given the digitalization, so the volume driven market has declined”
Rajesh Rathi, page 11 of the filed PDF · View the filing
Unquantified employee restructuring charge at a wholly owned subsidiary
p. 11
“right now the quantification was not possible”
Amitabha Mukhopadhyay, page 11 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.