Shree Hari Chemicals Sees Revenue Plunge 58%, Profit Down 77%; EPS Surges on Dilution

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AuthorVihaan Mehta|Published at:
Shree Hari Chemicals Sees Revenue Plunge 58%, Profit Down 77%; EPS Surges on Dilution
Overview

Shree Hari Chemicals Export Ltd reported a dismal Q3 with revenue down 58% and profit plummeting 77% YoY. The company's Earnings Per Share (EPS) paradoxically increased due to the conversion of Zero Coupon Compulsorily Convertible Debentures (CCDs), significantly impacting the equity base. Consolidated PAT saw a massive 1394% QoQ jump, but YoY performance remains weak, with no forward guidance issued.

📉 The Financial Deep Dive

Shree Hari Chemicals Export Limited has posted a starkly disappointing Q3 FY26 results, marked by significant year-over-year declines in both revenue and profitability.

The Numbers:

  • Standalone Revenue: ₹444.85 Cr, down 58.09% YoY from ₹1061.70 Cr in Q3 FY25. QoQ, revenue fell 40.27%.
  • Standalone Net Profit (PAT): ₹90.36 Cr, a sharp decline of 76.98% from ₹393.75 Cr YoY. QoQ, PAT saw an increase of 31.17%.
  • Standalone EPS (Basic): ₹717, up 20.50% from ₹595 YoY. This increase in EPS, despite a substantial drop in net profit, is a critical point of concern.
  • Consolidated Revenue: ₹444.86 Cr, mirroring the standalone figures with a 58.09% YoY decrease and 40.27% QoQ fall.
  • Consolidated Net Profit (PAT): ₹87.76 Cr, down 76.94% YoY from ₹379.39 Cr. However, consolidated PAT experienced a dramatic 1394.21% increase QoQ from ₹6.29 Cr.
  • Consolidated EPS (Basic): ₹715, up 33.64% from ₹535 YoY.

The Quality & The Grill:
The primary driver behind the rising EPS on a declining profit base is the conversion of Zero Coupon Compulsorily Convertible Debentures (CCDs) into equity shares on December 4, 2025, as noted in Annexure 4. This conversion has significantly expanded the equity base, meaning the existing profits are now spread across a larger number of shares, artificially boosting the EPS figure. This represents share dilution, not operational improvement.

The significant QoQ leap in consolidated PAT (1394.21%) contrasts sharply with the YoY performance. Investors will need clarity on whether this is due to a very low base in the preceding quarter or the realization of some one-off gains. The absence of any forward-looking guidance from the management exacerbates uncertainty regarding future performance, especially given the steep quarterly downturn.

Nine-Month Performance:
For the nine months ended December 31, 2025, standalone revenue grew 34.95% YoY to ₹1432.80 Cr. However, net profit plunged 82.5% YoY to ₹68.59 Cr. Consolidated revenue also grew 34.95% YoY to ₹1432.89 Cr, while consolidated PAT declined 78.82% YoY to ₹80.73 Cr.

🚩 Risks & Outlook:

The company faces significant headwinds. The severe YoY decline in Q3 revenue and profitability, coupled with substantial margin compression (consolidated PAT margin fell from ~35.7% in Q3 FY25 to ~19.7% in Q3 FY26), points to underlying operational challenges. The increase in share count due to CCD conversion requires careful investor assessment to understand its impact on shareholder value. The lack of management guidance leaves the outlook highly uncertain, demanding close monitoring of future performance and industry trends.

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