Fairchem Organics Ltd

Financial Performance

• Revenue for Q1 FY27 was ₹176 crore, up 34.4% YoY.
• EBITDA for the quarter was ₹18 crore with 10.14% margin.
• Net profit for the quarter was ₹10 crore.
• Volume processed 12,400 tonnes; 13,500 tonnes sold in quarter.
• Revenue mix: ~30% dimer acid, 42% linoleic acid, 4% isostearic acid, 24% others.

Operational Update

• Isostearic acid ramp-up expected to exceed 80% capacity utilization in 1–2 years.
• Current capacity utilization around 60%; year-end target 70–75%.
• Export outlook supported by India UK FTA and rupee depreciation.
• Power consumption reduced by over 30% and solid-fuel use by over 35%.
• Paint segment accounts for about 40% of domestic revenue; exports 7–8%.

Capacity and Projects

• Base capacity 80,000 MT; 40,000 MT oleochemical capacity addition from Q2.
• Isostearic acid ramp-up planned with trial run; stabilization needed before higher volumes.
• End-of-year utilization target 70–75%; plan to reach 100% before further expansion.
• R&D recurring spend around ₹50 lakh; about 1–1.5% of sales.
• New 40,000 MT capacity addition from Q2 for oleochemicals; product mix undisclosed.

Outlook and Risks

• Quarterly volume growth target of 5–7%; end-Q growth 15–20% YoY.
• Export revenue currently 7–8%; paints about 40% of domestic revenue.
• China dumping reduced but could recur; margins depend on supply dynamics.
• Isostearic acid ramp-up could extend timeline; approvals and customers require time.
• First priority is achieving 100% capacity utilization before further expansion.

Meeting Details

• July 28, 2026, 04:00 p.m. onwards.
• Group earnings call, virtual audio conference.
• Event: Earnings call on unaudited results for quarter ended June 30, 2026.

Participants

• Key company participant: Company Secretary & Compliance Officer.

Purpose

• Discuss unaudited financial results for quarter ended June 30, 2026.

Availability

• Audio recording of the earnings call available on the investor relations page.

AGM Details

• AGM held on 27 July 2026 at 3:30 PM via VC/OAVM.
• Remote e-voting conducted 22-26 July 2026.

Key Resolutions

• Adopt audited financial statements for year ended 31 March 2026.
• Declare final dividend of Re 1.00 per equity share.
• Reappoint Sumit Maheshwari as Director (retiring by rotation).
• Reappoint Sudhin Choksey as Independent Director.
• Ratify remuneration of Cost Auditors for FY ending 31 March 2027.

Voting Results

• Resolution 1 passed: 100% assent; 1 dissent.
• Resolution 2 passed: 100% assent; 1 dissent; 1 abstention.
• Resolution 3 passed: 100% assent; 2 dissent; 1 abstention.
• Resolution 5 passed: 96.92% assent; 3.07% dissent.
• Resolution 6 passed: 100% assent; 2 dissent; 1 abstention.

Director Changes

• Sumit Maheshwari reappointed as Director (retiring by rotation).
• Sudhin Choksey reappointed as Independent Director.

Business Overview

• Oleochemicals producer using vegetable oil by-products; promoted by Fairfax India.
• State-of-the-art unit with green manufacturing; Pan-India raw material sourcing.
• Forward integration into Monomer Fatty Acid and Isostearic Acid.
• Exports Isostearic Acid to multiple countries.
• Four growth pillars: cost optimization, product upgradation, new product, geographical diversification.
• R&D lab since 2018; ISO 9001/14001/45001 certifications.

Operational Highlights

• Q1 FY27 revenue ₹1,761 mn; EBITDA ₹179 mn; PAT ₹100 mn.
• YoY revenue up 34.4%; EBITDA margin 10.16%; PAT margin 5.68%.
• Raw-material throughput capacity expansion completed with minimal capex.
• Forward integration to co-products expanding value chain.
• Export expansion aided by US tariff environment and potential FTAs.
• Zero Liquid Discharge via MED and ATFD; scrubber system planned.
• R&D lab with European equipment; ISO certifications; governance enhancements.
• MD & Chairman: Nahoosh Jariwala; independent directors on board.

Financial Performance

• FY24-FY26 revenue: ₹6,215 mn; ₹5,379 mn; ₹4,596 mn.
• FY24-FY26 EBITDA: ₹670 mn; ₹428 mn; ₹216 mn.
• EBITDA margins: 10.78%, 7.96%, 4.70% (FY24–FY26).
• PAT (excl. exceptional): ₹405 mn; ₹220 mn; ₹62 mn.
• Q1 FY27 revenue ₹1,761 mn; EBITDA ₹179 mn; PAT ₹100 mn.
• Q1 margins: EBITDA 10.16%; PAT 5.68%.
• Promoters 63.26%; FPIs 6.34%; Public 28.38% as of 30 Jun 2026.
• Market cap ~₹8,449 mn; price ₹670.8 as of 30 Jun 2026.

Capital Structure & Liquidity

• Net debt to equity trend rising FY24–FY26; no new debt announced.
• Cash conversion cycle improved; detailed cash flow figures not disclosed.

Strategic Priorities & Outlook

• Four-pronged strategy: cost optimization, product upgradation, new product, geographical diversification.
• Export share target: 25%, aiming 50% of sales via tariffs and FTAs.
• Throughput expansion completed; potential for further green/low-capex capacity additions.
• Add one more raw material to expand oleochemicals portfolio.

Risks & Mitigation

• Macro uncertainty from Middle East; mitigated by US tariff relief and FTAs.
• Reliance on green supply chain; energy efficiency and supplier relationships reduce risk.
• Governance strengthening: risk framework, internal controls, and business continuity planning.

Governance & Leadership

• MD & Chairman: Nahoosh Jariwala; independent directors on board.
• Backed by Fairfax India Holdings; experienced management team.
• Ongoing governance initiatives and rigorous risk management.

AGM details

• AGM held on 27 July 2026 via VC/OVAM at 3:30 PM.

Ordinary business resolutions

• Adoption of Audited Financial Statements for year ended 31 March 2026.
• Declaration of final dividend of Re 1.00 per equity share (10%).
• Appointment of Director in place of Sumit Maheshwari on rotation.

Special business resolutions

• Re-appointment of Nahoosh Jariwala as Managing Director for 3 years (Aug 13, 2026–Aug 12, 2029).
• Re-appointment of Sudhin Choksey as Independent Director for second term (five years from Feb 11, 2027).
• Ratification of remuneration payable to Cost Auditors for FY 2026-27.

Voting results status

• Combined voting results to be announced within two working days after meeting.
• Outcomes for individual resolutions not disclosed in filing.

Voting window and meeting timing

• Remote e-voting opened 22 July 2026 at 1:00 PM and closed 26 July 2026 at 5:00 PM.
• AGM concluded at 3:55 PM.

Unaudited results approved

• Board approved unaudited IND-AS results for quarter ended 30 June 2026.
• Audit Committee reviewed results; Limited Review report from B S R and Co expressed unmodified opinion.

Financial highlights and segment

• Single reportable segment: Speciality Chemicals; Q1 revenue ₹17,614.57 Lakhs.
• Profit after tax ₹1,001.38 Lakhs; basic EPS ₹7.95; no exceptional items in Q1.

Buyback and capital actions

• Buyback of 425,000 equity shares completed; extinguished Jan 27, 2026; aggregate Rs 34 crore.
• Buyback approved Nov 20, 2025; postal ballot Dec 26, 2025; settled Jan 21, 2026.

Regulatory and other disclosures

• Labour Codes triggered additional employee benefit obligation of Rs 88.27 Lakhs; recognised as exceptional item.
• No subsidiary/associate/joint venture; single business segment.

Meeting Details

• Con-call to discuss Q1-FY27 earnings scheduled for July 28, 2026 at 4:00 PM IST.
• Mode: virtual conference call coordinated by Valorem Advisors.
• Management attending: Managing Director & Chairman; Chief Financial Officer.
• Purpose: discuss unaudited Q1-FY27 earnings for the quarter ended June 30, 2026.

Meeting Details

• Board meeting scheduled for July 27, 2026, to be conducted via Audio-Visual means.

Key Agenda Items

• Consider and approve unaudited IND-AS financial results for the quarter ended June 30, 2026.
• Subject to Limited Review by the Statutory Auditors.
• Any other business with the permission of the Chair.

Other Notes

• Trading window for designated persons closed July 1–29, 2026 for results announcement.

Demat processing and listing

• Dematerialisation requests processed; securities accepted/rejected by depositories for quarter ended 30 June 2026.
• Securities dematerialised were listed on exchanges where the existing issue is listed.
• Physical certificates for dematerialisation were mutilated and cancelled; depository registered owner updated within timelines.