Ganesh Benzoplast: Focused on Future Growth and Returns

Ashwin Thakker

— 2 min read
  • Sales Outlook: Anticipated steady overall growth, with 5-6% year-on-year rental escalation expected across its terminal business. The Chemical division is set to maintain its strong upward trend.
  • Margin Outlook: Chemical division's profit before tax surged 223% in Q1 FY'26 due to efficiency gains. Rising JNPT lease costs are projected to be offset by price adjustments within 1-2 years, ensuring margin stability.

Ganesh Benzoplast Limited reported strong Q1 FY'26 results, showcasing consolidated revenue growth of 9% and an impressive 10% increase in Profit After Tax (PAT) year-on-year. This robust performance provides a solid foundation as the company outlines its forward-looking guidance. Management detailed strategies for sustained profitability in its Chemical division, strategic expansion of liquid storage terminals, and optimizing capital deployment to enhance shareholder value, signaling a focused approach to future growth.

Chemical Division: Sustaining Momentum

Ganesh Benzoplast's Chemical division posted impressive Q1 FY'26 results, with profit before tax (PBT) increasing 223% year-on-year to INR 71 million. This robust growth stems from

upgradation of system at plant level, resulting in better yields and changes in raw material procurement policies, which resulted in improved cost effectiveness,

as stated by Mr. Amar Kabra. The company expects this "continuous steady pace" to persist. While exploring strategic partnerships or a demerger for value unlocking, the immediate priority remains stabilizing and sustaining the division's consistent upward profitability trend.

Strategic Expansion: JNPT Land and Capacity Growth

Ganesh Benzoplast is strategically planning the utilization of its 8 acres of prime JNPT land. A decision on developing either Liquid Storage Terminal (LST) or LPG facilities is expected by quarter-end. LST development could add "Approximately 1 to 1.5 lakh KL," representing a 30-40% increase in existing capacity. Overall rental income is forecast to grow 5-6% year-on-year, with JNPT expecting a "standard 4% to 5% year-over-year escalation of pricing." Though JNPT lease costs are rising due to the 30-year lease renewal, the company aims to "cover it within a year or 2" through price adjustments, ensuring stable margins.

Ganesh Benzoplast Limited's Q1 FY'26 results highlight a strategic pivot towards sustained profitability and focused growth. With significant improvements in its Chemical division and clear plans for JNPT land utilization, the company is set to enhance its core business. Proactive management of operational efficiencies and rental income, alongside a re-evaluation of dividend policy, positions Ganesh Benzoplast for continued robust performance and increased shareholder value.

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