Southern Magnesium FY26 Profit Crashes 96% to ₹12.64 Lakh; Q4 Turns Profitable

Full-Year Results Show Steep Decline

Southern Magnesium & Chemicals Ltd. revealed a steep 96% year-on-year drop in net profit for the fiscal year 2026, falling to ₹12.64 lakh from ₹319.77 lakh in FY2025. The company's total income also contracted significantly, dropping 69% to ₹3.99 crore from ₹13.00 crore. These audited financial results for the year ended March 31, 2026, were noted by the company's Board of Directors on May 4, 2026.

Fourth Quarter Recovery and Auditor Appointments

A brighter note emerged in the fourth quarter of FY2026, where revenue from operations increased slightly to ₹0.90 crore from ₹0.81 crore in the prior year's Q4. Importantly, the company reported a profit of ₹0.06 crore for Q4 FY2026, a reversal from a ₹(0.07) crore loss in the same period last year.

Separately, the board appointed M/s. D. Hanumanta Raju & Co. as secretarial auditors and M/s. K. S. Rao & Co. as internal auditors for the upcoming FY2026-27. The independent auditor's report on the FY2026 results was unqualified.

Impact and Future Outlook

The stark drop in the company's full-year profit and revenue for FY2026 points to significant challenges in operational performance or market demand during the period. While this year's results are concerning, the profitable fourth quarter offers a sign of recovery. The appointment of new auditors for FY2027 indicates a move to bolster financial oversight. Shareholders now have a clear picture of the severe contraction experienced in FY2026. Management is expected to address the causes of the downturn and present plans for future improvement.

Looking ahead, investors will seek management commentary detailing the specific reasons for the FY2026 performance slump. The company's guidance for revenue and profit expectations in FY2027 will also be important. Initial insights from the new auditors and broader trends in the industrial chemicals sector will provide further context.

Key Financial Metrics

Earnings Per Share (EPS) for FY2026 reflected the profit decline, falling to ₹0.42 from ₹10.66 in FY2025.