Sudarshan Chemical Industries (506655) Q4 24/25 earnings summary

Executive summary

• Heubach acquisition completed on 3 March 2025 for €151.9 million, expanding the pigment portfolio across 19 manufacturing sites and customers in over 100 countries.

• Integration priorities include synergies, customer service, technical capabilities, operational efficiency and consolidating four SAP systems into One SAP.

• FY25 audited consolidated results received a qualified opinion over an unresolved subsidiary asset transfer; a final dividend of ₹4.50 per share was recommended, subject to shareholder approval.

Financial highlights

• FY25 consolidated revenue was ₹3,34,557.5 lakhs, up 31.8% year-over-year; Q4 sales were ₹1,349 crore, up 76.6%.

• FY25 adjusted EBITDA was ₹402 crore, up 27.2%; Q4 adjusted EBITDA was ₹148 crore, up 24.4%. FY25 gross margin was 47.0%, up 2.8 percentage points.

• FY25 adjusted PBT was ₹223 crore, up 43.9%; acquisition-related exceptional items totaled ₹103.6 crore.

• Consolidated net profit was ₹9,456.2 lakhs versus ₹35,744.7 lakhs; FY24 included a one-time land-sale gain.

• Heubach contributed March sales of ₹525 crore, gross margin of 55.8% and EBITDA of ₹22 crore.

Outlook and guidance

• Heubach EBITDA target is €35 million in FY26 after integration costs, rising to €90 million–€100 million in 3–4 years; management also cited a 9%–10% margin target.

• Legacy business growth of 10%–11% is expected; cost reduction initiatives are expected to continue for 18 months, alongside efforts to win back lost business, particularly in Europe and the Americas.

• Cost synergies, IT integration and priorities in business recovery, cost and cash initiatives are expected to support margin expansion.

• RIECO is expected to turn around in FY26, with an opening order book double the prior year and an initial 7%–8% EBITDA margin target.

• Zero debt is targeted within 3–4 years.