Sudarshan Chemical reports 27% EBITDA growth in Q3FY25 amid strong pigment market expansion

Sudarshan Chemical Industries Limited has once again delivered strong financial results in the third quarter of FY25, marking its eighth consecutive quarter of revenue growth. The company’s consolidated income from operations rose 18% year-on-year (YoY) to ₹666 crore, driven by increased demand across key market segments.

The EBITDA margin improvement continues to be a key highlight, with the company reporting a 27% YoY increase in EBITDA, reaching ₹79 crore before exceptional items. This robust financial performance is underpinned by the steady expansion of its pigment business, which recorded a gross margin of 45.2%, reflecting efficient cost management and a diversified product portfolio.

Sudarshan Chemical, recognized as the third-largest global pigment producer, maintains a strong foothold in high-growth industries such as coatings, plastics, inks, and cosmetics. The company’s ability to scale operations across 80+ countries has reinforced its position in the global pigment market, further fueling its long-term growth trajectory.

What factors are driving Sudarshan Chemical’s profitability in Q3FY25?

The company’s profitability surged significantly in Q3FY25, with consolidated profit after tax (PAT) soaring 107% YoY to ₹31 crore. Over the first nine months of FY25, PAT totaled ₹102 crore, an 89% increase from the previous year. This impressive financial momentum has also resulted in EPS (Earnings Per Share) rising to ₹14.7, nearly doubling from ₹7.7 in the same period of FY24.

One of the standout improvements in Sudarshan Chemical’s financials is its net debt-to-EBITDA ratio, which has strengthened from 1.5x in Q3FY24 to 1.0x in Q3FY25. This reduction highlights the company’s focus on financial discipline, allowing it to optimize debt levels while continuing strategic investments in growth and expansion.

Managing Director Rajesh Rathi attributed this positive performance to a combination of operational excellence, strategic market positioning, and ongoing efficiency enhancements. He emphasized that the company remains committed to maximizing stakeholder value while accelerating its expansion strategy.

How is Sudarshan Chemical strengthening its global presence?

As part of its long-term expansion strategy, Sudarshan Chemical is making significant progress in completing its acquisition of Heubach, a key player in the global pigment industry. The integration process is well underway, signaling a major step in the company’s broader market consolidation and global outreach.

This acquisition aligns with Sudarshan Chemical’s mission to broaden its pigment market expansion while catering to the growing demand for specialty pigments across industrial applications. With an extensive portfolio spanning organic, inorganic, and pearlescent pigments, the company is well-positioned to capitalize on emerging trends in the chemical color solutions sector.

Additionally, Sudarshan Chemical continues to strengthen its manufacturing capabilities through its facilities in Roha and Mahad, India, ensuring seamless production and supply chain efficiency. By leveraging technological advancements and R&D investments, the company is poised to enhance product innovation while maintaining cost-effective operations.

What role does the Qualified Institutional Placement (QIP) play in Sudarshan Chemical’s growth strategy?

In January 2025, Sudarshan Chemical successfully completed a Qualified Institutional Placement (QIP), raising ₹799.99 crore by issuing 74,76,635 equity shares at ₹1,070 per share. This strategic capital infusion is expected to support the company’s long-term expansion efforts, optimize its financial position, and fuel investment in high-potential market segments.

Prominent institutional investors, including Tata Mutual Fund, DSP Small Cap Fund, Nippon Life India Trustee Ltd, and Abakkus Diversified Alpha Fund-2, were among those acquiring more than 5% of the QIP equity shares, reflecting strong investor confidence in Sudarshan Chemical’s growth prospects and market leadership.

What does the future hold for Sudarshan Chemical?

With a solid financial foundation and a clear strategic roadmap, Sudarshan Chemical is expected to maintain its growth momentum in the coming quarters. The global demand for pigments continues to rise, and the company is well-positioned to capitalize on this trend through its expanding product portfolio and diversified customer base.

The company’s focus on EBITDA margin improvement, along with enhanced manufacturing capabilities and strategic acquisitions, will be critical in sustaining its competitive edge. As it deepens its global footprint, Sudarshan Chemical aims to drive innovation, optimize production efficiency, and expand its reach across key international markets.

Industry analysts remain optimistic about Sudarshan Chemical’s market positioning, particularly as it advances its specialty pigment offerings and strengthens relationships with leading global clients. The company’s financial prudence, debt reduction efforts, and operational efficiencies position it well for sustained revenue and profit growth in the coming years.

A growth-focused trajectory for Sudarshan Chemical

Sudarshan Chemical’s Q3FY25 performance underscores its ability to achieve consistent revenue expansion, improved profitability, and financial stability amid an evolving market landscape. With a strong global presence, strategic acquisitions, and disciplined financial management, the company remains well-positioned for long-term success in the pigment industry.

As it continues to execute its growth strategy, Sudarshan Chemical’s commitment to innovation, operational excellence, and market expansion will be key drivers of its future performance. Investors and stakeholders will closely watch the company’s next moves as it navigates industry trends and capitalizes on emerging opportunities in the global pigment market.