Laxmi Organic avoids FY27 revenue targets as logistics costs bite

What's new

• Q4 revenue grew 9-10% QoQ across essentials and specialties.
• Logistics costs have doubled since the Middle East conflict began.
• Ethyl acetate spreads currently sit at $150-160, below the $220 historical average.
• CFO Amit Jain joins on June 16 from Gharda Chemicals.

Key quotes

• "It would be fair to say logistics costs have doubled since this conflict started, plus a host of other surcharges. This is a negative drag."

  — Dr. Rajan Venkatesh, MD and CEO

• "Guidance is premature pending environment stabilization."

  — Laxmi Organic management on FY27-28 targets

The brief

Laxmi Organic is playing a defensive game. While Q4 revenue showed sequential growth of 9-10%, the company refused to back analyst targets of ₹3,700-4,000 cr for FY27. Management cites a fluid chemical environment and persistent supply chain headwinds that are fundamentally different from the pandemic era. Logistics costs have doubled due to the Middle East conflict, and ethyl acetate spreads remain trapped at $150-160, well below the long-term $220 average. With new capacity coming online at Dahej Phase 2, the company needs these spreads to normalize to justify its capital expenditure. Management’s refusal to set guidance suggests they are unconvinced that the current price floor for acetic acid will hold. Execution in the specialty segment will be the primary lever for recovery in the coming quarters. Until those margins stabilize, the company's growth outlook remains highly speculative.