HSCL - Himadri Speciality Chemical Ltd. Share Price

The management of Himadri Speciality Chemicals provided a positive outlook during the Q4 and FY26 earnings call, emphasizing the company's commitment to innovation and growth, particularly in the lithium-ion battery materials segment. Key forward-looking points highlighted by the management include:

1. Lithium-Ion Battery Materials Expansion: The company successfully commissioned its first anode material manufacturing facility with an initial capacity of 200 metric tons per annum. This marks a significant step in entering the lithium-ion battery materials value chain.

2. Future Capacity Goals: The Phase 1 capacity for lithium-ion phosphate cathode active material is set to reach 40,000 metric tons per annum, with the first milestone of 2,000 metric tons targeted for commissioning by Q3 FY27. Full Phase 1 operations are expected by FY29.

3. Long-Term Aspirations: Himadri aims to build up to 200,000 metric tons of lithium iron phosphate (LFP) cathode active material, positioning itself as the first company outside of China to establish commercial-scale LFP manufacturing, catering to both domestic and international markets.

4. Financial Performance: For FY26, consolidated revenue was INR 4,661 crores, with EBITDA at INR 1,006 crores, reflecting a year-on-year growth of 19%. Profit After Tax (PAT) stood at INR 755 crores, growing by 36% from the previous year.

5. Birla Tyres Contributions: The Birla Tyres division generated revenue of INR 187 crores in FY26, with expectations to reach around INR 3,000 crores in top line contribution over the next four years.

6. Research and Development Investment: The company invested INR 120 crores in R&D, underpinning its commitment to innovation and development of new materials.

7. Market Engagement: There is a strong focus on customer engagement with leading OEMs, as well as collaborations, such as with Sicona Battery Technologies, which enhance the company's product offerings and market position.

The management expressed confidence in achieving sustainable long-term value for shareholders as they leverage their expanding capabilities in advanced materials and continue to execute their growth strategy.

Q1: Can you share us the thought process of the growth trajectory for anode? For the anode business, we are still working on the trajectory and will provide specific figures and investment timelines later.

Q2: What will be the market size for anode today? Anode and cathode together make up 65% of the lithium-ion cell cost, utilized in a 1:2 ratio. Anode demand is stable across chemistries, and we uniquely position both pitch-based and silicon-carbon anodes.

Q3: With the situation in the Middle East, will you shift focus for coal tar pitch? This is temporary. We are diverting shipments to other regions like Southeast Asia and Africa, and it's not materially impacting our operations.

Q4: How has the ramp-up been for the new carbon black plant? We have built a sustainable business model where we can transfer costs to customers and will maintain profitability regardless of input costs.

Q5: What is the peak revenue potential from your new anode facility? The 200 metric ton capacity is primarily to commercialize R&D efforts and won't materially contribute to revenues until we announce larger-scale investments.

Q6: What was Birla Tyres' top-line contribution in FY26, and future expectations? Birla Tyres contributed INR 187 crores in FY26, and we expect it to reach around INR 3,000 crores over the next four years.

Q7: Do you have guidance for consolidated revenue and EBITDA margins for FY27? For FY27, while I can't provide exact numbers, we aim to double our PAT to over INR 1,100 crores by FY28, suggesting strong growth ahead.

Q8: What is your expected capacity utilization for the carbon black business in FY27? We expect an 85-90% capacity utilization for our new carbon black capacity, with higher EBITDA per ton for specialty products.

Q9: How has your hedging policy affected forex loss? The sharp depreciation affected imports and forced us to hedge positions, which led to losses. Moving forward, we plan to keep positions open to reduce volatility.

Q10: Any binding LOIs or contracts signed for LFP supply? While we cannot disclose specific contracts due to NDAs, we are engaging with industry leaders, and our capacity will depend on product approvals.