Q1 2027 Ester Industries Ltd Earnings Call Transcript
Key Points
- Consolidated EBITDA surged 103.4% YoY to INR58.9 crores, with margin expanding to 13.3% from 8.3%, and PAT turned positive at INR18.6 crores versus a loss of INR7.2 crores in Q1 FY26.
- Film segment revenue grew ~38% YoY to INR399.5 crores, with EBIT margin improving to 9.8% from 2.4%, driven by higher realizations and a better product mix.
- Value-added specialty (VAS) films volume increased 23% YoY to 6,368 metric tons, raising its share of total film volumes to 29% from 24%, with a target of 50-60% in 2-3 years.
- Ester Filmtech achieved its highest-ever capacity utilization of ~83%, with EBITDA turning positive at INR19.5 crores versus a loss of INR2.7 crores in Q1 FY26.
- Specialty Polymers EBIT margin improved significantly to 45.3% from 31.7%, reflecting a stronger product mix and robust profitability.
- rPET volumes grew 19% YoY to 1,394 metric tons, and the company expects to exceed 100% of rated capacity by the exit quarter of FY27.
- ELITe JV secured a letter of intent from a leading global sports brand for offtake of up to 15,000 metric tons per year of Loop PET fiber grade resin, validating the technology and market demand.
- Management expressed confidence in sustaining improved earnings for the next 6-8 quarters due to favorable supply-demand dynamics and stable global prices.
- Debt repayment target of INR100 crores for FY27, with no major CapEx planned, supporting deleveraging and cash flow generation.
- Specialty Polymers segment revenue declined to INR32.7 crores from INR48.1 crores YoY due to demand pressure in one high-margin product, with volumes down to 725 metric tons from 954 metric tons.
- rPET external sales volumes declined sequentially due to increased internal consumption, which may mask the segment's growth in financial statements.
- Other income included one-off gains from treasury and favorable foreign exchange, which are not sustainable on a quarterly basis.
- The company refrained from providing specific revenue and EBITDA guidance for FY27 and FY28, citing uncertainty.
- Gross debt remains elevated at INR722 crores, with net debt expected to stay significant even after planned repayments.
- ELITe project is still in the engineering phase, with land acquisition pending and commissioning not expected until CY2028, carrying execution risks.
- Specialty Polymers revenue growth is expected to be flat or single-digit in FY27, with margin normalization as VAP products scale up.
- The company faces potential competition in textile-to-textile recycling, though it claims technological differentiation.
- Capacity utilization in the film segment, while improved, is still below optimal levels at 84%, leaving room for operational inefficiencies.
Ladies and gentlemen, good day, and welcome to the Q1 FY27 Earnings conference call of Ester Industries Limited. (Operator Instructions) Please note that this conference is being recorded. I now hand the conference over to Mr. Amit Sharma from Adfactors PR. Thank you, and over to you, sir.
Thank you, Sagar. Good afternoon, Everybody, and a very warm welcome to you all. Thank you, everyone, for participating in the earnings call of Ester Industries Limited for the first quarter ended 30th June 2026. On the call today, we have Mr. Vaibhav Jha, CEO; Mr. Pradeep Rustagi, Executive Director, Corporate Affairs; and Mr. Sourabh Agarwal, CFO of the company. The management will take us through the operational and financial performance for the quarter, following which we will open the forum for the question-and-answer session.
Before we begin, please note that this conference call may contain forward-looking statements about the company, which are based on the beliefs, opinions and expectations of the company as on the date of
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