Rossari Biotech surges in Q2 FY25: Profits jump 7.3% amid global expansion

Rossari Biotech Limited, a prominent manufacturer in the specialty chemicals sector, announced its financial performance for the second quarter of FY25. The company reported a steady rise in revenue and profits, showcasing its robust business strategy despite market challenges.

The firm’s consolidated revenue from operations increased by 3.1% year-on-year, reaching INR 498.4 crore, up from INR 483.5 crore in Q2 FY24. Additionally, Rossari’s EBITDA rose by 3.6%, standing at INR 65.9 crore, with a marginally improved EBITDA margin of 13.2%. The company’s net profit (PAT) experienced a notable increase of 7.3%, reaching INR 35.3 crore compared to INR 32.9 crore the previous year. Diluted earnings per share (EPS) for the quarter climbed to INR 6.4 from INR 6.0.

Performance Overview

For the first half of FY25, Rossari’s revenue surged by 10.5% to INR 988.0 crore compared to INR 894.1 crore in H1 FY24. EBITDA saw a 7.8% rise, reaching INR 130.8 crore. The company’s PAT for the first half increased by 12.9%, standing at INR 70.2 crore. The EPS (diluted) for the half-year period improved to INR 12.7.

Strategic Developments and Global Expansion

The company has made several strategic moves to boost its global presence. The establishment of Rossari Biotech Trading FZE, a step-down subsidiary in the UAE’s Jebel Ali Free Zone, marks an important milestone. This entity aims to enhance Rossari’s trading capabilities in chemicals and consumer products for export markets.

In a strategic acquisition, Rossari Biotech has agreed to acquire Unistar Thai Co. Limited, subject to regulatory approvals. This acquisition is anticipated to bolster Rossari’s specialty chemical operations, adding a new layer to its expanding international footprint.

Expert Insights: Focus on Innovation and Sustainability

Promoter and Executive Chairman Edward Menezes, alongside Promoter and Managing Director Sunil Chari, highlighted the company’s focus on resilient growth and innovation. They stated that the Home, Personal Care, and Performance Chemicals (HPPC) division continues to be a growth driver, despite challenges in the textile sector. Export growth in H1 FY25 was reported at 32%, with management expecting international markets to further strengthen the company’s growth trajectory.

Menezes and Chari emphasized Rossari’s commitment to sustainable and eco-friendly products, noting the importance of expanding their portfolio to meet evolving customer needs. They affirmed their intention to enhance global manufacturing and distribution networks, with plans for further growth in both domestic and international markets.

Outlook and Future Prospects

Rossari Biotech continues to prioritize innovation and sustainability, leveraging its diversified portfolio and agile manufacturing capabilities. The company recently acquired additional land at its Dahej facility to support its future expansion plans. This move, along with the strategic acquisition of Unistar, positions the company for long-term growth.

Industry expert Gurudas Aras, who was recently appointed as a Non-Executive Independent Director, is expected to provide valuable guidance, especially given his extensive experience in the textile sector. His role is anticipated to further strengthen Rossari’s strategic initiatives and global outreach.

Recent Share Price Movement and Market Sentiment

Rossari Biotech’s stock has responded positively to the latest financial results and strategic developments. On the Bombay Stock Exchange (BSE), the stock saw an uptick of 2.8% following the announcement. Analysts have noted that the company’s focus on international expansion and its continued efforts in sustainability are likely to support its long-term valuation. Investor sentiment remains optimistic, with experts anticipating that Rossari’s global diversification and planned expansion projects will lead to sustained growth in the coming quarters.