Kothari Fermentation's power bill erased its profit
Energy costs hit ₹26 cr, turning an ₹0.81 cr profit into a ₹2.99 cr loss for the year.
— 2 earlier stories on Kothari Fermentation & Biochem Ltd. →What's new
- Kothari Fermentation swung to a full-year net loss of ₹2.99 crore, versus a ₹0.81 crore profit in FY25.
- Annual revenue slipped to ₹112.13 crore, with power-fuel costs exceeding ₹26 crore.
- Q4 net profit of ₹1.27 crore relied on a deferred tax credit.
Why this matters
For a company with a ₹61 crore market cap, a ₹3 crore annual loss is material. The core issue is energy costs at 24% of turnover, a structural problem that a single quarter's tax credit cannot mask.
What we're watching
- Whether management addresses the energy-cost burden in the next concall.
- If the Q4 profit sustainability holds without tax credits.
- Any capex or efficiency plans to counter the power-fuel drag.
The full read
Kothari Fermentation's year was defined by a ₹26 crore power and fuel bill. That single cost, about 24% of its ₹112.13 crore revenue, turned an ₹0.81 crore profit in FY25 into a ₹2.99 crore net loss in FY26. A ₹1.27 crore Q4 profit softened the blow, but it was propped up by a deferred tax credit. The problem is structural. For a ₹61 crore company, energy costs this high make profitability nearly impossible at current revenue levels. A tax credit is a one-time fix. The new internal auditors inherit a clear challenge: find a way to cut the power bill, or the losses will recur.
Questions answered
- Why did Kothari Fermentation swing to a loss?
- Power and fuel costs exceeded ₹26 crore for the year, consuming about 24% of the ₹112.13 crore in revenue. This single cost line erased the previous year's ₹0.81 crore profit and created a ₹2.99 crore loss.
- Was the Q4 profit of ₹1.27 crore a sign of recovery?
- The Q4 profit was supported by a deferred tax credit, not underlying operations. Without that one-time benefit, the quarterly result would look different, and the full-year loss shows the business remained under pressure.
- What does the company's size have to do with this?
- With a market capitalization of just ₹61 crore, a net loss of nearly ₹3 crore represents a significant portion of its value. The scale of the loss relative to the company's size makes the profitability erosion more acute.
- What did the board do besides approve the results?
- The board appointed Arun K. Garg & Associates as internal auditors for FY27. This is a standard governance procedure, though it comes as the company's financial health weakens.
Story so far
All notes on KFBL →- 29 May 2026 · 8:34 PM IST Kothari Fermentation's power bill erased its profit
- 1d ago Kothari Fermentation's profit turned into a loss. Energy costs ate 24% of revenue.
- 1d ago Kothari Fermentation swings to ₹2.99 cr full-year loss as power costs bite