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Aether Industries Limited broadcast the transcript of its Earnings Conference Call held on 3 May 2025 to discuss the financial performance for the Fourth Quarter and Financial Year ended 31 March 2025.
Key highlights from the call:
Q4 FY25 consolidated revenue stood at ₹2,453 million, EBITDA at ₹819 million (33% margin), and PAT at ₹504 million (21% margin).
Compared to Q3 FY25, EBITDA increased by 8% and PAT by 16%.
FY25 consolidated revenue increased by 38% to ₹8,803 million (from ₹6,374 million in FY24).
FY25 EBITDA was ₹2,709 million (31% margin), a 72% increase over FY24 (₹1,577 million, 25% margin).
FY25 PAT was ₹1,584 million (18% margin), a 92% increase over FY24 (₹825 million, 13% margin).
Overall volumes surged by 21% QoQ in Q4 FY25 and 34% YoY for FY25.
Pricing for products remained stable over the past six months.
Revenue mix in Q4 FY25: 38% from Contract/Exclusive Manufacturing (CEM), 10% from Contract Research and Manufacturing Services (CRAMS), and 51% from Large-Scale Manufacturing (LSM). The company targets a 70% contribution from CRAMS and CEM.
CRAMS and CEM businesses grew by 55% in FY25, contributing to increased margins.
Expansion updates:
Site-1 (R&D/Pilot): Double expansion ongoing, excavation started, bullish on R&D/CRAMS. R&D expense for FY25 was ₹681 million (approx. 8% of revenue).
Site-2/Site-3: Running at full capacity post-fire incident stabilization.
Site-3++: Fully dedicated to a key client under a CEM business model (non-pharma, non-agro). Installation underway, production expected end Q3 FY26.
Site-4 (Oil field services, including Baker Hughes): Running well with healthy order book. Generated approx. ₹25 crore revenue in Q4 FY25 (validation), commercial supplies started April 2025. Expect ramp-up in FY26, full ramp-up in FY27 towards ₹250-₹300 crore.
Site-5 (Panoli): Advancing steadily. First two production blocks on track for commissioning by December 2025. First 3-4 plants mostly finalized, including LSM products and CEM/CM projects. Recently acquired additional 15 acres (total 46 acres) due to bullish outlook and inquiries.
US market exposure is minimal at 7% of total sales (mostly CRAMS), limiting potential tariff impacts.
Working capital cycles improved: Inventory cycle reduced to 173 days (from 210 days in FY24), Debtor cycle reduced to 126 days (from 142 days in FY24). Targeting further reduction to 150 days within 2-3 years.
Return ratios improved: ROE increased to 7.12% (from 4% in FY24), ROCE increased to 8.5% (from 4.7% in FY24).
Benefits from solar power were ₹188 million in FY25 (vs ₹172 million in FY24).
Revamping of the fire-affected site (Site-2/3) is complete, with 100% operations since January 2025. Stock insurance claim received, confident of fixed asset/loss of profit claim settlement by end Q2 FY26.
On future outlook, the company does not provide numerical guidance but expects average EBITDA margins around 29-30% in FY26, growing gradually.
Management comment (Dr. Aman Desai): “It is a golden age for the Indian chemical industry… especially over the last three to six months we are seeing that this is especially the case. We are seeing tremendous potential and all the opportunities that are available to Indian specialty chemical companies…”
Converge polyols business: Contract with H.B. Fuller is well executed. Looking to close two new contracts in FY26, targeting >500 tons manufacturing/sales.