Fineotex Chemical Ltd

Rating Action

• Long-term cash credit upgraded to AA- (Stable) from A+ (Positive), w.e.f. 24 August 2026.
• Unallocated limits upgraded to AA- (Stable) and A1+; long-term upgraded, short-term reaffirmed.
• Short-term overdraft reaffirmed at A1+.
• Short-term fund-based others reaffirmed at A1+.

Instruments / Ratings

• Long term - Fund based - Cash credit: AA- (Stable) from A+ (Positive).
• Short term - Fund based - Overdraft: A1+; reaffirmed.
• Short term - Fund based - Others: A1+; reaffirmed.
• Short term - Non-fund based - Letter of credit: A1+; reaffirmed.
• Short term - Non-fund based - Others: A1+; reaffirmed.
• Unallocated limits: AA- (Stable) / A1+; upgrade of long-term and reaffirmation of short-term.

Rationale

• Acquisition of 53.33% US CrudeChem stake expands scale and diversification.
• Consolidation and synergies support revenue ramp and market reach.
• Financial risk profile remains strong with negligible debt and robust coverage.
• Liquidity position is strong, backed by cash and unutilised limits.
• Outlook: Stable; acquisition expected to sustain growth and credit metrics.
• Risks: competition, raw-material volatility, forex exposure; mitigants include pass-through and diversification.
• FY2026 revenue Rs 772 crore; OPM 17.4%; NPM 16.2%; debt negligible.

Outlook

• Outlook: Stable.

Change Since Last Rating

• Long-term rating upgraded to AA- (Stable) from A+; outlook revised to Stable from Positive.

Financial Highlights

• FY2026 consolidated revenue Rs 772 crore; OPM 17.4%; NPM 16.2%; debt negligible.
• FY2026 PAT Rs 125 crore.

Financial highlights

• Standalone revenue from operations: 39,687.83 Lakhs.
• Consolidated revenue from operations: 77,222.56 Lakhs.
• Standalone PAT: 9,188.96 Lakhs; Consolidated PAT: 12,501.51 Lakhs.
• Standalone EPS: 0.80; Consolidated EPS: 1.09.
• Final dividend proposed: Rs 0.05 per share; Interim Rs 0.80 already paid.
• Record date for final dividend: 04 Sep 2026.
• Total equity (Mar 31, 2026): Rs 75,429.50 Lakhs.
• Total assets (Mar 31, 2026): Rs 81,786.38 Lakhs.
• Consolidated total assets: Rs 115,921.65 Lakhs.
• Net debt to equity (consolidated): -0.03x (net cash).

Operations & expansion

• FY2025-26 production: 81,731 MT; previous year: 60,692.40 MT.
• Sales volume: 80,356.73 MT.
• Ambernath facility commissioned; capacity added 15,000 MT.
• Acquired 53.33% stake in CrudeChem Technologies LLC (Dec 2025).
• Product portfolio expands to over 470 specialty products.

Capital, dividends & shareholding

• Share capital increased to Rs 11,645.01 Lakhs; 1,16,45,00,900 shares (post-split).
• Bonus issue: 4:1; stock split approved Oct 2025.
• Warrants converted into 18,75,000 shares; further conversions increased equity base.
• Promoters hold 58.88% of equity; other major holders disclosed in notes.

ESG & sustainability

• Energy intensity: 4.60 GJ per Rs crore; water intensity: 126.18 KL per Rs crore.
• Renewable energy use: 94,716 kWh; Ambernath rooftop solar.
• CSR spend: Rs 118.75 Lakhs; workforce 300; women 20.56% of permanent staff.
• Zero workplace accidents in FY2025-26.
• ESG credentials: ZDHC, NABL, GreenPro; EcoVadis Commitment Badge; US EPA approvals.
• Great Place to Work certification achieved; multiple governance credentials.

Governance & key changes

• Board size: 7; Independent Directors: 4 including one woman; two women on board.
• Chetan Navinchandra Shah appointed Independent Director Aug 12, 2025.
• Navin Mittal ceased as Independent Director Sep 27, 2025.
• Audit Committee: 4 members; 6 meetings conducted in FY2025-26.
• Secretarial Audit by HSPN & Associates; annual secretarial compliance reported.
• Related Party Transaction policy: arm's length, up to ₹500 crore; Schedules disclosed.

Strategy & outlook

• Strategic growth through India-Malaysia-USA platform; expand across textile, water treatment, cleaning, oilfield chem.
• Intensified R&D and application-led product development; cross-market technology transfer.
• Pursue selective inorganic growth to enhance technology, customers, and geographic reach.
• Maintain disciplined capital allocation; expand renewable energy adoption and governance frameworks.

Subsidiaries & acquisitions

• Subsidiaries include FSPL, Manya Manufacturing, Finoclean, Fineotex Malaysia, and CCT group (Dubai/USA).
• CrudeChem acquisition broadened North American oilfield platform; multiple US entities integrated as step-down subsidiaries.
• BT Chemicals SDN BHD and related Malaysian units remain major group entities with strong ties.

Risks & regulatory environment

• Exposure to raw material price volatility, FX fluctuations, and regulatory changes.
• Geopolitical and supply-chain disruptions could affect demand in certain markets.
• Ongoing focus on compliance with SEBI LODR, ICDR, and corporate governance standards.

AGM Details

• AGM on Friday, 11 September 2026 at 04:00 PM IST via VC/OAVM.
• Record date for voting: 04 September 2026.
• Remote e-voting period: 08-10 September 2026.

Dividend

• Interim dividend already declared: Rs 0.80 per equity share.
• Final dividend proposed: Rs 0.05 per equity share.
• Record date for final dividend: 04 September 2026.
• Payment by 30 September 2026, subject to tax deduction.

Resolutions

• Ordinary: Adopt Audited Standalone and Consolidated Financial Statements for FY2025-26.
• Ordinary: Confirm interim dividend and declare final dividend of Rs 0.05 per share.
• Ordinary: Re-appoint Aarti Mitesh Jhunjhunwala as director.
• Ordinary: Ratify remuneration of Cost Auditor Rs 50,000 plus taxes.
• Special: Raise funds via issuance of equity or other securities up to ₹800 crore.
• Special: Approve material related party transactions with FZE and CCT up to ₹500 crore.

Material Related Party Transactions

• RPTs between FZE and CCT up to ₹500 crore for FY2026-27, arm's length.
• RPTs include sale, purchase, services and loans; defined as material.
• Counterparties: Fineotex Biotex HealthGuard FZE and CrudeChem Technology LLC.

Directors / Cost Auditor

• Re-appointment of Mrs Aarti Mitesh Jhunjhunwala as director (DIN 07759722).
• Remuneration of Cost Auditor ratified: Rs 50,000 per annum plus taxes.

Overview

• Standalone BRSR for FY2025-26 covering Apr 1, 2025 to Mar 31, 2026.
• Manufactures specialty chemicals; 100% turnover from textile, oil & gas, hygiene and cleaning.
• Six plants and one office in India; one international office; 14 states, 70 countries; exports ~15.3%.
• CSR applicability Yes; CSR turnover ₹39,687.83 Lakhs; net worth ₹75,429.50 Lakhs.
• Assurance: Standalone; not applicable.

Key ESG Risks & Opportunities

• Occupational health and safety: risk; mitigated by ISO 45001 and safety teams; negative financial implications.
• Water management: risk; reuse of rinse water and STP treatment; negative financial implications.
• Hazardous products: opportunity; GHS classification drives safer products; no disclosed financial impact.
• Sustainable product development and procurement: opportunity; lifecycle management and renewable materials.
• Social accountability: opportunity; code of conduct for stakeholders enhances ethics and trust.
• Governance and ethics: opportunity; anti-corruption and whistleblower policy strengthen governance.
• Cybersecurity and data privacy: risk; ISO 27001 and policy mitigate; potential negative impact.
• Risk management: positive; dedicated risk management committee oversees risks and mitigation.

Governance & Policy Highlights

• Administrative Committee is highest authority for BR policy implementation and ESG oversight.
• Board-approved policies cover anti-bribery, whistleblower, human rights, and ESG governance.
• Anti-bribery policy in place; link: https://fineotex.com/wp-content/uploads/2023/08/Anti-Bribery-and-Anti-CorruptionPolicy.pdf
• Whistleblower and Code of Conduct; annual conflict declarations by directors.
• Assurance: Not Applicable; zero fines/penalties in FY2025-26.

Social Responsibility & Workforce

• Total workforce: 120 permanent employees and 180 workers.
• Board female representation: 2 of 7 directors (28.6%).
• Turnover FY2025-26: permanent employees 4.25%; workers 1%.
• Well-being expenditure: 6.05% of revenue on well-being measures.
• LTIFR: 0 for both employees and workers.
• 100% training coverage across board, KMP, employees, and workers.
• Grievance mechanisms: SCORES portal; investor email; plant grievance box.
• Human rights policy and ICC for sexual harassment; RPwD Act compliant; equal opportunity policy.
• Gross wages for females as share of total: 15.93%.
• Parental leave return-to-work/retention: 0% across categories.
• Premises accessible to differently abled; RPwD Act compliant.

Environmental Performance

• Total energy: 1,827.41 GJ; renewables 340.98 GJ; non-renewables 1,486.44 GJ.
• Energy intensity: 4.60 GJ per crore turnover; PPP-adjusted 93.65.
• Water withdrawals/consumption: 50,080 KL; no water discharge reported.
• Water intensity: 126.18 KL per crore turnover; 2566.60 KL per USD PPP.
• GHG: Scope 1 162.36 tCO2e; Scope 2 330.32 tCO2e; total 492.68 tCO2e.
• Emission intensity: 1.24 MT/Cr turnover; 0.0134 MT/MT goods.
• Waste: plastic 56 MT; total waste 149 MT; 56 MT reused; 93 MT disposed.
• Zero-liquid-discharge: treated water reused for gardening.
• Certifications: ISO 14001, ISO 9001, ISO 45001, ISO 27001; SA8000; NABL labs.
• Solar rooftop: 100 kW at Ambernath plant since Sep 2023.
• EPR compliance: CPCB registrations and waste collection plans submitted.

Stakeholder Engagement & Complaints

• Key stakeholder groups: suppliers, customers, investors, employees/workers, financial institutions, community.
• Engagement methods: emails, meetings, events, surveys; frequency varies (continuous/annual).
• Grievances FY2025-26: zero complaints filed; zero pending resolutions.
• Grievance mechanisms: SCORES portal; investor email; plant grievance box.
• ESG policy available on company website.

Other Notable Metrics

• Sustainable sourcing: ~90% of inputs sourced sustainably.
• NABL-accredited labs support testing and product development.
• No product recalls in FY2025-26.
• Data privacy: ISO 27001; no data breaches reported.
• Value chain assessments: 45% of partners assessed for health and safety practices.
• EPR compliance: CPCB registrations and waste collection plans filed.

Financial performance

• Standalone revenue ₹39,687.83 Lakhs; down vs ₹43,922.21 FY24-25
• Standalone PAT ₹9,188.96 Lakhs; decline vs ₹9,722.67
• Consolidated revenue ₹77,222.56 Lakhs; up from ₹53,333.28
• Consolidated PAT ₹12,501.51 Lakhs; up 14.5% YoY
• Consolidated EPS ₹1.09; Standalone EPS ₹0.80
• EBITDA (Consolidated) ₹16,781.93 Lakhs
• ICRA reaffirmed long-term A+ Positive; short-term A1+
• Interim dividend ₹0.80 per share; final ₹0.05 proposed for FY26

Operational performance and capacity

• Ambernath facility commissioned; first phase adds 15,000 MT annually
• Consolidated production 81,731 MT; sales 80,356.73 MT FY2025-26
• CrudeChem Technologies Group acquired 53.33% stake; US oilfield platform
• Record date for final dividend 04-Sep-2026; approval at AGM pending

Capital structure and dividends

• Total equity (Consolidated) ₹93,972.95 Lakhs; Standalone ₹75,429.50 Lakhs
• Equity share capital increased to ₹11,645.01 Lakhs; 11,645,00,900 shares
• Bonus issue 91,66,00,720 shares; stock split; record date 31 Oct 2025
• Warrant conversions: 1,37,50,000 and 50,00,000 shares; 18,75,000 warrants converted
• Final dividend proposed ₹582.25 Lakhs; ₹0.05 per share

Cash flows and liquidity

• Consolidated cash flow from operations: negative ₹2,380.88 Lakhs
• Investing cash flow: ₹10,517.59 Lakhs; Financing: ₹-6,251.58 Lakhs
• Net cash from year: ₹2,720.44 Lakhs; closing cash ₹5,611.79 Lakhs

ESG and sustainability

• ESG at a glance: low carbon 0.55 μg/m3; water intensity 126.18 KL per crore
• Renewable energy consumption 94,716 kWh; Great Place to Work certified
• CSR spend ₹118.75 Lakhs; unspent ₹168.80 Lakhs carried to CSR account

Governance and risk

• Board: 7 directors; 4 Independent; 2 women; KMPs aligned to governance
• ICRA reaffirmation; governance framework with risk management and internal controls
• Auditors: ASL & Co. re-appointed; Secretarial: HSPN & Associates; Cost Auditor: V J Talati

Strategic developments

• CrudeChem acquisition expands high-value oilfield chemicals platform
• Ambernath expansion supports broader multi-vertical chemicals growth

AGM Details

• AGM date/time: 11 September 2026 at 04:00 PM IST via VC/OAVM.
• Record date for voting eligibility: 04 September 2026.
• Remote e-voting: 08–10 September 2026, 09:00–17:00 IST.
• AGM conducted via VC/OAVM; deemed venue is the registered office.

Resolutions proposed

• Ordinary: Adopt standalone and consolidated financial statements for year ended 31 March 2026.
• Ordinary: Confirm interim dividend and declare final dividend for 2025-26.
• Ordinary: Re-appoint Mrs. Aarti Mitesh Jhunjhunwala as director.
• Ordinary: Ratify cost auditor remuneration of Rs 50,000 per annum for FY2026-27.
• Special: Approve fund-raising by issuing securities up to ₹800 crore.
• Special: Approve related party transactions with FZE and CCT up to ₹500 crore.

Dividend

• Interim dividend of Rs 0.80 per equity share already paid.
• Final dividend of Rs 0.05 per share proposed for FY2025-26.
• Record date fixed for final dividend: 04 September 2026.
• Payment by 30 September 2026 subject to tax deduction at source.

Directors

• Re-appoint Mrs. Aarti Mitesh Jhunjhunwala as Director (DIN 07759722).
• Remuneration last drawn in 2025-26: Rs 1.07 crore.
• Board attendance in 2025-26: 7 of 7 meetings.

Auditors

• Cost Auditor remuneration ratified: Rs 50,000 per annum for FY2026-27.

Material Related Party Transactions

• Counterparties: Fineotex Biotex HealthGuard FZE and CrudeChem Technology LLC.
• Nature: sale/purchase of goods or services; loans and advances.
• Aggregate value: up to ₹500 crore for FY2026-27.
• Pricing: arm's-length; TNMM.

Capital raising / Other approvals

• Board-approved enabling resolution to issue Securities up to ₹800 crore.
• Pricing floor not less than ICDR floor price; discount up to 5%.
• Completion window: 365 days from resolution passing.
• No single allottee >50% of issue size; MF minimum 10%.

Record date and AGM details

• Purpose: set cut-off date for remote e-voting and record date for final dividend.
• Security: Equity shares.
• Record date and cut-off date: September 04, 2026.
• AGM date and mode: September 11, 2026 at 04:00 PM IST via VC/OAVM.
• Dividend payment details: amount not specified; final dividend subject to AGM approval.