VST Industries Ltd

VST Industries Limited: Trading Window closed from 1 October 2026 until 48 hours after the unaudited results for the quarter and half year ended 30 September 2026

Financial performance

• Net revenue Rs 256 crore, down 13.5% YoY from Rs 296 crore.
• Cigarette volume averaged 611 million per month, down 14.4% YoY from 714 million.
• EBITDA Rs 50 crore; margin 19.5% versus 26.0% in prior year.
• Profit after tax Rs 42.4 crore; down 24.4% YoY from Rs 56.1 crore.
• Tax changes increased cigarette tax incidence by about 50% on average.

Outlook and drivers

• Given extraordinary tax increases, a challenging year lies ahead; pricing to protect consumer base.
• Illicit trade growth remains a significant threat; focus on brand portfolio and in-market execution.
• Geopolitical instability in the Middle East weighs on unmanufactured tobacco growth.

Financial highlights

• Revenue from operations (gross) ₹86,127 lakhs; other operating income ₹44 lakhs.
• Total revenue from operations ₹86,171 lakhs; total income ₹88,149 lakhs.
• Other income ₹1,978 lakhs.
• Total expenses ₹54,434 lakhs.
• Profit before tax ₹8,528 lakhs; tax ₹1,586 lakhs.
• Profit after tax ₹1,242 lakhs; EPS ₹2.50.

Operational & reporting notes

• Single operating segment: tobacco and related products; Ind AS 108 not applicable.
• Board approved unaudited results; quarter ended 30 June 2026; limited review unqualified.
• Standalone results; no subsidiary or associate; no consolidation.

Auditor remarks & tax note

• Note: GST/Excise changes affected comparability of gross sales and excise duty.
• Audit firm: B S R & Associates LLP; limited review report unqualified.
• Results reviewed by Audit Committee and approved by the Board on 28 July 2026.

Meeting Details

• Board meeting on 28 July 2026 to consider unaudited results for quarter ended 30 June 2026.

Key Agenda Items

• Approve unaudited quarterly results for the quarter ended 30 June 2026.

Other Notes

• No additional notes provided in the filing.

CHRO appointment

• Appointment of Mr. Venkateshwaran Sundaram as CHRO (Senior Management Personnel) effective 13 July 2026.
• He is a seasoned HR leader with ~30 years across manufacturing, pharma, and e-commerce.
• Former VP - HR at V-Guard Industries; has held roles at Dr. Reddy's, Amazon, PepsiCo, Pidilite, Godrej.
• Reason for change: Appointment as Senior Management Personnel.
• Disclosure of relationships with other directors: NA.

Summary heading: Summary of Certificate under Regulation 74(5) for quarter ended 30 June 2026.

• Registrar confirms dematerialisation compliance under Regulation 74(5) for quarter ended 30 June 2026.
• Demat Transfer Register (01/04/2026 to 30/06/2026) sent to depositories and stock exchanges.
• Securities received from DPs after dematerialisation were destroyed/mutilated/cancelled within the stipulated time.

Overview

• Standalone FY2025-26 BRSR; VST Industries manufactures cigarettes containing tobacco.
• Main activity accounts for 100% turnover; exports are 11% of turnover.
• Turnover by product: cigarettes 84.8%; unmanufactured tobacco 15.2%.
• Markets served: 26 states and 6 union territories in India; 8 international markets.
• Locations: 1 national plant and 13 offices; no international plants.
• Reporting boundary: standalone; no subsidiary companies.

Key ESG Risks & Opportunities

• Energy management reduces costs and supports GHG reductions; risks if targets miss.
• GHG emissions central to climate response; expanding Scope 3 accounting.
• Water risk from tobacco cultivation; Toopran operates ZLD; AWS Gold certified.
• Health & safety practices strong; ongoing risk monitoring and hazard assessments.
• Sustainable leaf sourcing framework; ALP/GAP contracts with traceability.
• Hazardous waste disposed via PCB-approved recyclers; TPW monitored within regulatory limits.
• Farmer livelihoods improvement through productivity and water efficiency programs.
• Circular economy: EPR in place; 100% recyclable packaging; plastic neutrality achieved.
• Climate resilience: climate risk assessment underway; integrated into planning.
• Human rights/ethics: ALP monitoring; Code of Conduct; compliance important for regulators.

Governance & Policy Highlights

• Board approves BR policies; Corporate ESG Committee oversees BR strategy.
• Policies aligned with NGRBC principles; ISO 45001/14001, AWS, IGBC Gold, ISO 17025.
• Anti-bribery embedded in Code of Conduct; no separate policy.
• RPT policy; related party transactions require Audit Committee approval.
• Whistleblower and POSH policies; independent directors oversee shareholder concerns.
• BR policy reviews conducted; statutory compliance monitored quarterly.
• Life cycle assessments not conducted in FY25-26; plan to undertake.
• Zero-accidents target in own operations.

Social Responsibility & Workforce

• Total workforce: 359 permanent employees and 353 workers.
• Gender: 10 female permanent employees; no female workers; board has one female director.
• Turnover: permanent male 23%, female 30%; workers male 7%.
• LTIFR: zero; no safety fatalities recorded.
• Well-being spend: 0.14% of revenue.
• CSR spend: ₹7.58 crore; about 1 million lives benefited.
• CSR focus areas: Rural Development, Health & Sanitation, Education & Sports, Environment Sustainability.
• Human rights: 100% trained on human rights; ALP Code monitoring.
• Retirement benefits: PF and Gratuity 100%; NPS 33.4%; ESI not applicable.
• Grievance mechanisms: Whistleblower and POSH; quarterly Townhalls; escalation to Audit Committee.
• Union membership: permanent employees 0%; permanent workers 100%.
• Training: health/safety and skill-upgradation programs for employees and workers.
• Parental leave: 100% return-to-work and retention.
• Grower Management System enhances end-to-end tobacco leaf traceability.

Environmental Performance

• Total energy 34,844 GJ; renewables 5,766 GJ; 33% solar share.
• Solar capacity: 1.18 MW on-grid; 15 kW solar street lighting.
• GHG emissions: Scope 1 1,009 tCO2e; Scope 2 2,677 tCO2e; total 3,686 tCO2e.
• Energy intensity: 0.00000017 tCO2e per INR; 0.62 tCO2e per million cigarettes.
• Water: groundwater 19,777 kl; third-party 4,593 kl; total withdrawal 24,370 kl; ZLD in Toopran.
• Toopran achieves 25% treated water reused; rainwater harvesting capacity >4x net consumption.
• Waste: total 485.46 MT; plastic 83.78 MT; recycled 485.42 MT; disposal 0.0409 MT.
• Packaging: 100% recyclable; plastic neutrality achieved.
• Standards: ISO 45001/14001; IGBC Gold; AWS; ISO 17025.

Stakeholder Engagement & Complaints

• Stakeholders: investors, shareholders, customers, farmers, communities, NGOs, employees, suppliers, government.
• Engagement cadence: investors quarterly; others annually or ongoing.
• Shareholder complaints: 19 filed in FY2025-26; 0 pending at year-end.
• Townhall discussions and ESG Committee feed stakeholder views into BR planning.
• 07% of value-chain partners assessed for environmental and social impacts.
• RPT governance: related party transactions approved by Audit Committee; no material issues.

Other Notable Metrics

• Data privacy and cyber security: robust framework; no data breaches; policy link provided.
• Cyber policy includes IT controls, data backup, and disaster recovery center.
• Product recalls: Nil; no voluntary or forced recalls reported.
• No significant green credits; sustainable supply chain framework with 46.07% partner assessments.
• Packaging and sustainability: 100% recyclable packaging; plastic neutrality; EPR in place.

Financials

• Revenue from operations: ₹204,575 Lakhs.
• Net profit: ₹29,225 Lakhs.
• EBIT: ₹34,873 Lakhs; margin 17%.
• EPS: ₹17.21; RoCE: 27.8%.
• Final dividend proposed: ₹12 per equity share.
• Record date for dividend: 10 July 2026.
• Dividend payable within 30 days of AGM if approved.
• FY26 revenue grew vs FY25: ₹204,575 vs ₹180,943 Lakhs.
• EPS rose from ₹17.10 to ₹17.21.
• Debt-free; no borrowings reported.

Brand & Portfolio

• Mid-premium segment >40% of industry; strong traction in FY25-26.
• EDITIONS and TOTAL drive growth; Editions Trio launched.
• Heritage brands Charms, Special, Moments strengthened in regions.
• TOTAL is pan-India across multiple formats.
• Portfolio balances legacy franchises with newer, experience-led formats.

Operations & Manufacturing

• Toopran plant: integrated world-class facility with PMD and SMD.
• 100% mechanised field preparation achieved.
• 80% mechanised stubble removal across farms.
• 18 MW solar meets about 33% of plant power.
• 15 kW solar street lighting; energy efficiency gains.
• PNG replacing LPG for canteen saves 65 tonnes CO2 annually.
• Toopran: Zero Liquid Discharge; 25% wastewater reused.
• 5S, TPM, TQM implemented; NABL lab certification in progress.
• 712 employees: 359 management, 353 workers.

ESG & CSR

• ESG 2030 roadmap progress across environment, people, governance.
• GHG intensity: 0.62 tCO2e/million cigarettes; energy intensity: 5.90 GJ/million.
• Water intensity: 4.12 KL/million cigarettes; 33% renewable energy in mix.
• CSR spend: ₹7.58 Crore; ~1 million lives benefitted.
• Toopran AWS Gold; rainwater harvesting >4x net water use.
• Board independence: 50%; women directors: 13%.
• 07% of inputs sourced sustainably; 46.07% of value-chain partners ESG assessed.
• Packaging: 100% recyclable/biodegradable; plastic-neutral under EPR.
• CSR initiatives include Naari Shakti, Bhavishya Bharat, Mobile Dispensary.

Governance & Risk

• Board eight directors; four independent; MD & CEO appointed 2 Mar 2026.
• Sanjay Wali resigned; Piyush Srivastava appointed MD & CEO.
• Auditors: BSR & Associates LLP; PwC recommended as statutory auditors 2026-31.
• Secretarial auditor: Tumuluru & Company; no qualifications.
• Audit Committee chaired by Sudip Bandyopadhyay; independent directors on committees.
• Related party transactions reviewed by Audit Committee; no material conflicts.
• CEO/CFO certifications; internal financial controls deemed adequate.
• Dividend Distribution Policy available on company website.

Capital & Ownership

• Equity share capital: ₹16,986.11 Lakhs; 16,98,61,120 shares.
• Dematerialised shares: 99.88% of total; near 16.96 crore.
• Promoter stake: Bright Star 25.95%; Raleigh 23.45%; Tobacco Makers 8.28%.
• Top promoter holdings total 32.16%.
• Bonus shares issued in Aug 2024: 15,441,920 shares.
• No pending share transfers; IEPF for unclaimed dividends.

Regulatory & Legal

• Ongoing tax disputes: Jharkhand/Assam Entry Tax; Excise duties and Cenvat matters.
• PILs seek tobacco ban; health warning litigation; Supreme Court stay in Karnataka matter.
• Azamabad land monetization; writ petitions in various courts; pending resolutions.
• COTPA restrictions: advertising limits and 85% health warnings; litigation ongoing.
• Real estate issues: land disputes from 1991; actions to resolve.

Outlook & Risks

• FY27 outlook complex due to taxation regime and illicit trade risk.
• Strategy: sharpen portfolio, pricing discipline, cost efficiency, digital enablement.
• Continue investments in product innovation and distribution expansion.
• Maintain governance standards and regulatory compliance while navigating market headwinds.