Himadri Speciality's strong quarter masks three unexplained flip-flops
Q1 revenue up 28%, PAT up 27%, but management's credibility takes a hit with timeline and location changes
The numbers
- Revenue rose 28% YoY to ₹1,431.88 crore, the highest quarterly figure.
- Net profit at ₹228.43 crore, up 27% YoY, with EBITDA margin of 22%.
- Board approved ₹368 crore capex for three projects: 6,000 MT super specialty carbon black, 5,300 MT Anthraquinone, and 200 MT carbon nanotubes.
- Market cap of ₹34,213 crore, P/E 45.5, debt/equity 0.16.
Management's story
- Reaffirmed ₹1,100 crore consolidated PAT target by FY28.
- Maintained LFP cathode capacity timeline: 40,000 MT by FY28, 200,000 MT by FY31.
- Claimed CNT facility will generate ₹50-70 crore topline at full capacity.
- Said all capex self-funded from internal accruals, no debt planned.
“Carbon nanotubes have 100 times the strength of steel with the conductivity of copper in a light material, which is a game changer.”
— Anurag Choudhary, CEO
Where they diverge
The numbers tell a clean story of growth and strategic capex. But the call revealed three unexplained shifts: Birla Tyres revenue target slipped from '4 years' to '4-5 years', the anode plant location moved from Mahistikry to Budge Budge, and the operating partner changed from Dalmia Refractory to Gallon Refractory. Management didn't address any. The quarter is strong, but these unacknowledged changes chip away at the guidance investors are asked to underwrite.
The full read
Himadri Speciality Chemical delivered a strong Q1: revenue up 28% to ₹1,432 crore, net profit up 27% to ₹228 crore, and a ₹368 crore capex for new specialities. The numbers are fine. The problem is the call. Management reaffirmed long-term guidance but three unexplained contradictions surfaced. The Birla Tyres revenue target stretched from 4 years to 4-5 years. The anode facility location switched from Mahistikry to Budge Budge. The operating partner changed from Dalmia Refractory to Gallon Refractory. None were explained. Individually trivial, collectively they suggest imprecision. When a company asks investors to underwrite a ₹4,800 crore LFP cathode bet by FY31, credibility on timelines matters. One strong quarter doesn't erase the pattern. The full read: the quarter settles that growth is on track, but it leaves open whether management's guidance can be trusted without hard milestones.
What we're watching
- Q3 FY27: LFP cathode 2,000 MT target – first milestone for battery materials.
- Q4 FY27: CNT facility 200 MT by Q4 FY27, topline guidance of ₹50-70 cr.
- FY27 end: Any further timeline revisions on Birla Tyres revenue target.
- Anode commercial-scale capex disclosure (still undecided).