Shree Hari Chemicals Export Ltd Q2 FY26: From Acidic Losses to Sweet Profits – 105% Sales Surge & a Solar-Powered Comeback!
1. At a Glance
If chemical companies had personalities, Shree Hari Chemicals Export Ltd would be that classmate who failed half the semesters but suddenly topped the board exams. From negative profits and gloomy margins just a few quarters ago, the Mahad-based H-Acid manufacturer has pulled off a spectacular turnaround in Q2 FY26 (September 2025) — revenues zoomed 105% YoY to ₹74.5 crore, while PAT jumped 58% to ₹3.54 crore.
With a market cap of ₹61 crore and a stock price hovering around ₹110, the company is now trading at a modest P/E of 13.4x — not bad for a smallcap that nearly self-combusted a few years back. The ROE stands at 19.5%, ROCE at 17.7%, and debt-to-equity ratio at 0.63, proving the acid plant isn’t as toxic as it used to be. Promoters, clearly sensing the revival, have upped their stake from 49.25% to 54.25%, a rare bullish move in smallcap chemicals.
From a 1.50 MW solar power plant humming since FY22 to new CCD conversions in late 2025, Shree Hari looks like it’s not just making dyes — it’s colouring its own balance sheet in green again.
2. Introduction
Ah, the Indian chemical industry — where “explosive growth” can be literal. Shree Hari Chemicals Export Ltd, born in 1987, has been through every shade of fortune possible. Once drowning in red ink, it now seems to have learned how to turn acid into assets.
This Mahad-based company’s life story is a Bollywood-worthy comeback. From losing ₹20 crore in FY23 to clocking ₹9.81 EPS in FY25, the journey’s been nothing short of a neutralization reaction. What changed? A disciplined approach, exports to over 20 countries, and probably the realization that acid can burn, but debt burns faster.
Still, it’s not all roses — no dividends in years, occasional volatility, and a history of low ROE (-17% over 3 years) remind investors that every hero has a past. But if recent quarters are anything to go by, this old dye dog just learned some new chemistry tricks.
3. Business Model – WTF Do They Even Do?
In simple terms, Shree Hari Chemicals makes H-Acid, the chemical grandparent of everything colourful you wear or print. Without this acid, half your T-shirts would be white and sad.
Its product range reads like a chemistry lab inventory:
H-Acid – the main money-spinner (~98% of revenue).
Acid Dyes & Direct Dyes – for silk, wool, and nylon.
Intermediates – fancy acids like R Salt, Koch Acid, G Salt, etc.
Reactive Dyes – for cellulose and synthetic fibers.
Basically, if there’s colour in your wardrobe, some molecule from Mahad probably helped it stick.
The company runs a 270-ton annual capacity plant and exports to over 20 countries — from Singapore and Turkey to Canada and New Zealand. Add a 1.5 MW captive solar plant, and it’s clear the management is trying to reduce both carbon emissions and electricity bills.
Not bad for a company that once looked like it was going out of chemistry and into history.
4. Financials Overview
Quarterly Results (₹ in crore, Standalone)
Metric
Sep 2025 (Latest)
Sep 2024 (YoY)
Jun 2025 (QoQ)
YoY %
QoQ %
Revenue
74.49
36.28
24.32
+105%
+206%
EBITDA
5.29
3.83
-1.31
+38%
Turnaround
PAT
3.54
2.24
-1.66
+58%
Turnaround
EPS (₹)
7.18
5.04
-3.37
+42%
Turnaround
Commentary: What a transformation! After two dull quarters, Shree Hari exploded back into profitability like a delayed chemical reaction. The YoY sales doubled, margins improved to 7.1% OPM, and the EPS jumped 42%. The June quarter losses were washed away in acid rain of cash flow.
For perspective, annualizing the latest EPS gives about ₹28.7, which at ₹110 CMP translates to an annualized P/E of ~3.8x — absurdly cheap, if the company can keep this up.
5. Valuation Discussion – Fair Value Range Only
Let’s go nerdy.
A. P/E Method:
Current EPS (TTM): ₹9.81
Industry P/E: 20.8
Company P/E: 13.4
So, fair value range = 9.81 × (13–20.8) = ₹128 to ₹204
B. EV/EBITDA Method:
EV = ₹74.5 crore
EBITDA = ₹10.6 crore (FY25 TTM)
EV/EBITDA = 7.0x If sector average ~10x, implied range = ₹115–₹160
C. DCF (Simplified): Assume FCF grows 10% for 5 years, discount at 12%, terminal 4% — intrinsic range = ₹120–₹150
🎯 Educational Fair Value Range: ₹120 – ₹170 Disclaimer: This fair value range is for educational purposes only and is not investment advice.
6. What’s Cooking – News, Triggers, Drama
2025 has been eventful, to say the least.
November 2025: Invested ₹5 crore in SDPL, acquiring 50 lakh shares — possible diversification or a new chemical venture brewing.
December 2025:6,05,494 equity shares allotted after CCD conversion at ₹79/share. Promoters clearly putting money where their molecules are.
September 2025 AGM: Reappointment of Sanjay Kedia as Whole Time Director — the man steering this acid ship since before GST was cool.
14th Nov 2025: Declared Q2/H1 FY26 results, showing a clean balance sheet,
