Srivasavi Adhesive Tapes FY26 Concall Decoded: Revenue Hit ₹110 Cr While Margins Took a Nap
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1. Opening Hook
Srivasavi just crossed ₹110 crore in revenue—its highest ever—and immediately declared it a “peak investment year.” Translation: the topline flexed while the bottom line held its breath. The company added five manufacturing units in a single financial year, invested ₹17+ crore in capex, and cheerfully announced it’s running three of them at 50% utilization. That’s the shape of the story: growth on the headline, margin pressure underneath, and a ₹10.58 crore capital work-in-progress queue waiting to turn into operating loss.
2. At a Glance
Metric
Reality Check
Revenue
₹109.98 Cr (+22% YoY). Highest topline ever. Unspectacular growth rate for a capacity play.
Profit After Tax
₹6.01 Cr vs ₹6.80 Cr last year (−12% YoY). The growth didn’t reach the bottom line.
Operating Margin
8.46% (down from 10% last year). Capacity added; margins compressed.
Cost of Raw Materials
₹83.08 Cr (up from ~₹75 Cr). Input cost ate 75% of revenue.
Finance Cost
₹47 lakh (up from 28 lakh). Borrowings rose to fund expansion.
Debt
₹17.9 Cr (long-term + short-term). Debt-to-equity: 0.38. Modest, but climbing.
Depreciation
₹1.43 Cr (up from 1.1 Cr). New assets, not yet producing returns.
Capital Work in Progress
₹10.58 Cr (Unit 5 polymer division + Unit 6 on the horizon). Revenue-generating capacity: zero.
3. Management’s Key Commentary
On the investment thesis: “We deliberately chose to invest ahead of our demands.” — D N Anilkumara (Translation: We built capacity betting the market would follow. Units 3 and 4 are at 50%. Betting still ongoing.)
On backward integration: “Our backward integration and in-house pressure-sensitive adhesive and sealants developing polymer division is what let us compete in that import substitute opportunity.” — D N Anilkumara (Translation: We’re making our own adhesives so we don’t have to buy them from Korea and Japan. Sounds strategic. Costs ₹10 crore and won’t generate revenue until FY27-28.)
On the defense PSU win: “We are supplying to ammunition factory, parachute factories, and electronics BEL.” — D N Anilkumara (Translation: We’ve entered the high-barrier defense supply chain. Scale? Unquantified. Timeline? “Years to come.”)
On margin timeline: “I’m precisely aiming this year for double-digit margins. I will try to achieve that.” — D N Anilkumara (Translation: Margins sat at 8.46% last year. Aiming higher. No math on how, or when.)
On working capital: “Minimum 75 days. It goes up to 100, 100 also sometimes, because all OEM customers.” — D N Anilkumara (Translation: OEMs tie up our cash for 3+ months. That’s structural, not negotiable.)
On the ₹2.58 crore acquisition that is now worth ₹20 crore: “Today’s value is somewhere around 20 crores. We got around 10% price only.” — D N Anilkumara (Translation: Management bought used equipment from a bank auction. The bargain of the year—if it works.)
4. Numbers Decoded
Line Item
FY26
FY25
Change
The Number Speaks
Revenue from Operations
₹109.98 Cr
₹90.16 Cr
+22%
22% growth. Call it healthy for a small-cap. Not transformational.
Cost of Raw Materials
₹83.08 Cr
~₹75 Cr (est.)
+₹8 Cr
Raw material inflation ate 75% of revenue. Passthrough lag baked in.
