Neogen Chemicals reported mixed but resilient performance for Q3 FY26, with consolidated revenues growing 9% to ₹220 crore. Profitability was impacted by costs related to the Dahej fire incident recovery, though insurance claims are underway. The company highlighted significant progress in its Battery Chemicals vertical (Neogen Ionics), with key expansion milestones achieved, positioning it strongly for the growing global demand for non-FEOC compliant lithium materials.
Q3 & 9M FY26 Performance Highlights
Neogen Chemicals announced its Un-Audited Financial Results for the quarter and nine months ended December 31, 2025. Key performance highlights (Consolidated basis) show revenue resilience:
- Revenues: Grew 9% YoY in Q3 FY26 to ₹220 crore, and 7% in 9M FY26 to ₹615 crore.
- Gross Profit: Increased 13% YoY in Q3 FY26 to ₹104 crore.
- EBITDA: Declined 8% YoY in Q3 FY26 to ₹32 crore.
- PAT: Declined sharply by 63% YoY in Q3 FY26 to ₹4 crore.
The company noted that profitability was negatively impacted by post-fire operating and insurance costs, with recoveries expected in FY27. Higher interest costs related to Dahej plant reconstruction and expansion spends in Neogen Ionics also affected PAT.
Revenue Composition
The consolidated revenue break-up for Q3 FY26 shows that 78% came from the Domestic market, while 22% was from Exports. Organically, growth was strong at 85% of total revenue.
Segment-wise (Consolidated, 9M FY26):
- Organic Chemicals: Revenue reached ₹535 crore, marking a 10% increase over 9M FY25 (₹485 crore).
- Inorganic Chemicals: Revenue stood at ₹80 crore, a decrease of 13% over 9M FY25 (₹90 crore).
Key Operational Updates (Neogen Chemicals)
The company provided significant updates regarding the fire incident and corporate actions:
- Fire Incident: In the nine months ended December 31, 2025, the company received ₹83.48 Crore from insurance (including an ₹80.00 Crore on-account payment). The net claim receivable reduced to ₹251.12 Crore.
- Replacement Plant: Construction of the replacement plant is progressing rapidly, with commissioning scheduled for Q1 FY27.
- Capital Raise: The Board granted in-principle approval to raise up to ₹150 crore through a preferential equity issue to the Promoter Group.
Neogen Ionics Expansion Milestones
The Battery Chemicals division, Neogen Ionics, is executing a major CAPEX plan of INR 1,500 crore, targeting peak revenue of INR 2,500 to INR 2,950 crore by FY29.
Proposed Setup & Status:
The total planned capacity includes 32,000 MT of Electrolyte and 5,500 MT of Lithium Electrolyte Salts & Additives across its sites.
- Lithium Electrolyte Salts: 200 MTPA is commissioned, with the remaining 1,100 MT expected by March 2026 and another 1,000 MT by Q1 FY27.
- Electrolytes: The 2,000 MT plant at the Dahej facility was fully commissioned in FY25.
Indo-Japan JV Update:
The joint venture with Japan’s Morita Investment Limited (MIL) to produce solid LiPF6 salt globally is advancing. Neogen holds an 80% majority stake in the new entity, Neogen Morita New Materials Limited (NML).
- The JV establishes India’s only non-FEOC compliant electrolyte salt plant, leveraging over 30+ years of Japanese technology.
Pakhajan Greenfield Project:
Commercial production of Electrolyte (H1 FY27) and Electrolyte Salt (H2 FY27) remains on track. Trial production for the Pakhajan Greenfield Electrolyte plant is expected to commence shortly after equipment assembly.
Management Commentary: The Strategic Pivot
Managing Director, Dr. Harin Kanani, stated that Q3 FY26 reflects a steady recovery and a strategic pivot toward a future-ready portfolio, emphasizing resilience in the base business (Pharma, F&F).
In Battery Materials, the company is poised to be the most cost-efficient lithium salt and electrolyte source, benefiting from the non-FEOC requirement for the U.S. 45X tax credit. Large-scale customer approvals are anticipated, leading to bulk consignments by H1 FY27.
Industry Outlook: Lithium Batteries in India
The Indian market presents strong opportunities driven by the Government’s PLI scheme (Target Incentive Outlay of INR 18,100 crore) and a mandate for 60% indigenous battery material.
- By 2030, Indian Electrolyte demand is estimated to exceed >150,000 MT.
- This corresponds to a Lithium Electrolyte Salt demand of 15,000 to 22,500 MT annually.
Globally, demand for non-Chinese Electrolyte and Lithium Salts is projected to increase substantially by 2030, driven by U.S. tax credit compliance deadlines requiring a full shift to non-FEOC suppliers by 2027.
The Way Forward
Neogen’s future strategy focuses on five key areas:
- Enhance focus on CSM & Advanced Intermediates through portfolio expansion.
- Augment capacities of Organic and Inorganic Chemicals.
- Expand capabilities in adjacent high-end complex chemistries.
- Deep inroads in the Battery Materials segment.
- Leverage strong R&D expertise to introduce innovative offerings.
ESG and CSR Commitments
The company emphasized its ESG integration, noting that ESG risks are integrated into the Risk Management Committee mandate. The structure was strengthened by separating the roles of Chairman and Managing Director, with Mr. Anurag Surana designated as the Non-Executive Chairman.
In CSR for FY25, the largest allocation was for Education (₹45.72 Lakh), followed by Water Conservation (₹37.81 Lakh). Neogen also secured the EcoVadis Silver Medal for 2025, ranking in the Top 15%.
Source: BSE
