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Q2FY26 Result Highlights In Q2 FY26, Acutaas Chemicals posted a strong performance with revenue rising 24.1% YoY to Rs.306 cr, driven by sustained demand in advanced pharmaceutical intermediates and specialty chemicals. Gross profit stood at Rs.171 cr, up 59.2% YoY, with gross margin improving to 55.8%, supported by a richer product mix and operational efficiencies. EBITDA nearly doubled to Rs.95 cr, with a sharp margin expansion to 31.1%, reflecting disciplined cost control and enhanced contribution from value-added segments. PAT increased to Rs.71.9 crore, up 91 YoY, translating to a PAT margin of 23.5%.

Operationally, exports continued to dominate the revenue mix, contributing 76% of quarterly sales, underscoring Acutaas’ strengthening global presence. The company is steadily scaling its portfolio in high-growth verticals such as battery chemicals, semiconductors, and electronic applications. Management reaffirmed confidence in delivering around 25% full-year revenue growth, backed by a resilient business model, innovation-led capabilities, and long-term strategic focus on high-value specialty chemicals.

Key conference call takeaways

Strategic Growth Verticals & Business Expansion

• The company is deepening its presence in three key pillars: CDMO, Battery Chemicals (electrolyte additives), and Semiconductor Chemicals.
• Management emphasized that these verticals are designed to drive long-term sustainable growth beyond traditional pharma intermediates.
• The Indicam JV in South Korea marks a strategic international leap into semiconductor materials, aiming to commercialize products from H2 FY27.
• Total capex for FY26 at Rs.250 cr with Rs.40 cr allocated for maintenance and the rest for growth projects. Current capex is directed towards electrolyte additive project (Rs.180 cr) and a pilot plant (Rs.30 cr).

CDMO Pipeline Progress & Portfolio Repositioning

• The CDMO business is gaining traction with multiple validation batches dispatched during the quarter, enhancing visibility and customer stickiness.
• The company is exiting low-margin legacy products in core pharma intermediates to sharpen focus on higher-value molecules under CDMO.
• Management confirmed a strong order pipeline with products progressing toward commercial scale-up, underscoring non-linear growth traction.

Electrolyte Additives Project & Capex Execution

• The Jagadiya electrolyte additive facility is progressing on schedule, with only minor weather-related delays—completion targeted by Q4 FY26.
• Installed capacity includes key electrolyte additives such as VC and FEC, backed by long-term customer agreements ensuring visibility offtake.
• A dedicated pilot plant is in development to accelerate new product development and customer qualification cycles.

Semiconductor JV (Indicam) & Global Collaboration

• The Indicam JV, with a Korean partner supplying technology and raw materials, is positioned as a major driver for semiconductor chemical exports. Acutaas will hold 75% in the JV.
• Product trials have begun, with early-stage feedback indicating strong demand potential in global chip manufacturing supply chains.
• This JV also helps diversify away from traditional pharma exposure, aligning with global decarbonization and electronics demand cycles.

Management Outlook, Guidance & Operational Update

• Management reiterated confidence in sustaining structural margin gains led by a stronger product mix, CDMO scale, and operational efficiencies with EBITDA margin guidance of 28-30% for FY26.  Revenue growth is set at 25% for the current financial year of FY26.
• Working capital controls are now stable, with a focus on tightening inventory discipline and debt management to support scale.
• The company’s long-term DNA remains built around innovation, multi-customer risk diversification, and premium product positioning, rather than near-term volume chasing.

Outlook & valuation

Acutaas Chemicals delivered a robust performance in Q2 FY26, underscoring the structural transformation underway in its business model. Revenue grew strongly, supported by sustained momentum in the Advanced Pharmaceutical Intermediates segment and rising contribution from the CDMO franchise. A sharp improvement in product mix and operational efficiencies translated into significant expansion in both gross and EBITDA margins, reflecting the company’s disciplined focus on high-value chemistry platforms. Export-driven growth remained a key lever, with 76% of quarterly revenues sourced internationally, reaffirming Acutaas’ positioning as a global specialty chemicals partner. Operationally, the company continued to phase out low-margin legacy products while scaling specialty molecules, particularly in regulated markets. The electrolyte additives facility at Jagadiya and the Indicam joint venture in South Korea progressed on schedule, reinforcing management’s multi-pronged growth strategy across pharmaceuticals, battery materials, and semiconductor chemicals.

Looking ahead, Acutaas outlined a confident outlook, backed by strong demand visibility, structural margin gains, and rising annuity potential from CDMO contracts. The company reiterated guidance of delivering around 25% revenue growth for FY26, while raising EBITDA margin expectations to a higher range, supported by premium product launches and improved business mix. Growth catalysts are well defined—commercialization of electrolyte additives from FY27, expanding CDMO validation pipeline, and strategic entry into semiconductor-grade chemicals under Indicam. Long-term supply agreements and customer diversification provide resilience against geopolitical and pricing risks. Capex of Rs.250 cr for FY26 remains focused on capacity creation and innovation platforms rather than volume expansion alone. While management acknowledged competitive pressures, especially from Chinese players in electrolytes, it asserted confidence in process differentiation and pricing discipline. With a strengthened balance sheet, strong export orientation, and increasing share of specialty and high-technology chemistries, Acutaas is positioned to transition from a volume-led manufacturer to an innovation-led global chemical solutions provider. At CMP, the stock is trading at 39x FY27EPS. We recommend a HOLD rating on the stock.