The sell-off in Himadri Speciality Chemicals extended into its sixth straight session on Friday, October 23, with the stock crashing another 6% to ₹492 apiece, its lowest level since April. The stock, which rode the bull wave in the first half of 2026, is now caught in a downward spiral as investor sentiment has been dented following the company’s September-quarter results.
Meanwhile, the broader market sell-off also fuelled the selling pressure, dragging the stock down 25.5% for the week and marking its worst weekly decline since 2008, when it plunged 34.5%. The heavy losses have also wiped out the stock’s gains for the year, while its share price has fallen 40% from its peak this year.
Higher input costs weigh on margins
The company reported revenue from operations of ₹1,542.67 crore in Q2 FY27, marking a 44.12% increase from ₹1,070.41 crore in Q2 FY26. Revenue also rose 21.06% sequentially from ₹1,274.26 crore in Q1 FY27, indicating strong growth in the September quarter.
However, the growth in revenue was accompanied by a sharper increase in the cost of materials consumed. Material costs surged 55.25% year-on-year to ₹1,048.83 crore from ₹675.60 crore in the year-ago quarter. Sequentially, material costs increased 30.42% from ₹804.17 crore in Q1 FY27, outpacing the 21.06% growth in revenue.
EBITDA increased 26.98% year-on-year to ₹308.19 crore from ₹242.71 crore in Q2 FY26. However, EBITDA growth lagged revenue growth by approximately 17.1 percentage points. Consequently, the EBITDA margin declined to 20% from 22.7% a year earlier, a contraction of around 2.7 percentage points.
On a sequential basis, EBITDA rose just 2.27% from ₹301.36 crore in Q1 FY27, despite revenue increasing 21.06%.
Net profit increased 28.32% year-on-year to ₹239.77 crore from ₹186.85 crore. However, net profit growth remained well below the 44.12% increase in revenue. The net profit margin declined to approximately 15.5% from 17.5% in Q2 FY26, a contraction of around 1.9 percentage points.
Meanwhile, the company plans to invest ₹1,125 crore in lithium iron phosphate (LFP), ₹248 crore in Speciality chemicals, ₹70 crore in carbon nanotubes and ₹170 crore in super speciality carbon black, according to its investor presentation for the July-September quarter.
Himadri Speciality share price trend
Despite the recent crash, Himadri Speciality Chemicals shares are still up 787% over the past five years, supported by strong gains accumulated between 2021 and 2024, when the stock delivered positive annual returns in each of those years.
In 2022 and 2023, the stock delivered multibagger returns of 123% and 207%, respectively. The rally continued in 2024, with shares surging another 90%.
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