SK Minerals & Additives Ltd: FY26 Revenue Surges 50% to ₹318 Crore

SK Minerals & Additives Limited has announced a robust financial performance for the fiscal year 2026 (FY26), with revenues climbing 50% year-on-year to ₹318 crore. The company also reported an improvement in its EBITDA margin to 10%, up from 9% in FY25. The profit after tax (PAT) margin also saw a positive shift, increasing from 5% to 6%.

Reader Takeaway: Revenue growth and margin expansion are positive; high working capital is a concern.

What just happened

SK Minerals & Additives reported a 50% year-on-year revenue growth for FY26, reaching ₹318 crore. This surge was driven by increased sales volumes, which rose by approximately 39.4% to 46,000 metric tons, and higher raw material prices. Profitability improved with EBITDA margins rising to 10% from 9% and PAT margins improving to 6% from 5%. The company also holds an order book of ₹55 crore, with ₹42 crore from government contracts.

Why this matters

This performance indicates strong demand for SK Minerals' products and successful execution of its strategy. The improvement in margins suggests better operational efficiency and a favourable product mix, possibly due to a strategic shift towards higher-margin manufacturing. The substantial order book provides visibility for near-term revenue.

The backstory

The company is currently operating its food and feed segments at nearly full capacity (around 95%). To support future growth, SK Minerals plans to expand its total capacity to 18,000 metric tons over the next 12-18 months. A significant strategic move involves entering the polymer additive space, specifically halogen-free flame retardants, which the management sees as a high-margin 'Blue Ocean' opportunity.

What changes now

SK Minerals is actively working to increase the contribution of its manufacturing segment to overall revenue, aiming to raise it from the current 23% to 50% within the next 2-3 years. The company is also investing ₹20 crore in planned capital expenditure for FY27-FY28. Additionally, a new polymer additive plant is expected to become operational within three months, with total capacity expansion to 18,000 MT targeted in 12-18 months.

Risks to watch

Key concerns for investors include the company's working capital cycle, which stands at 110 days, although efforts are underway to reduce this via invoice discounting. Supply chain disruptions due to geopolitical risks have led to raw material price volatility. Furthermore, new manufacturing lines for polymer additives are experiencing initial operational issues, which are expected to take 3-6 months to resolve.

Peer comparison

While specific peer data for FY26 is not provided in the filing, SK Minerals' 50% revenue growth suggests it is outperforming many players in the specialty chemicals and additives sector, which typically sees more moderate growth rates. The planned entry into high-margin polymer additives also positions it to capture niche market opportunities.

Context metrics (time-bound)

• FY26 Revenue: ₹318 crore (50% YoY growth)
• FY26 EBITDA Margin: 10% (up from 9% in FY25)
• FY26 PAT Margin: 6% (up from 5% in FY25)
• FY26 Sales Volume: 46,000 MT (up 39.4% YoY)
• Order Book: ₹55 crore (₹42 crore from Government)
• Working Capital Cycle: 110 days
• Planned Capex: ₹20 crore (FY27-FY28)

What to track next

Investors should monitor the successful resolution of operational teething issues in the new polymer additive plants, the company's ability to reduce its working capital cycle, and the progress of its strategic shift towards higher-margin manufacturing as it aims to reach 50% revenue contribution from this segment.