Alufluoride Q2 revenue rose 2.4 times as FSA recovered

Alufluoride Limited reported Q2FY27 operating revenue of Rs 63.9 crore, 2.4 times Q1FY27, after its supplier reported the fluorosilicic acid (FSA) constraint resolved on 15 July 2026. Operations at Visakhapatnam returned towards normal, while the final expansion phase was available throughout the quarter.

Why did Alufluoride's FSA supply recover in Q2FY27?

Alufluoride's supply recovery followed the supplier-reported resolution of the FSA constraint on 15 July 2026. The constraint had been disclosed on 23 May 2026, and Alufluoride says operations at its Visakhapatnam site subsequently returned towards normal. This recovery is the stated basis for Q2FY27 revenue reaching 2.4 times the Q1FY27 level.

FSA is the input variable Alufluoride says it manages most closely. It comes from the adjacent fertiliser complex and more distant suppliers, principally IFFCO Paradeep and Coromandel Kakinada. Freight on FSA from distant sources is rising with fuel prices, according to the presentation, so restored availability did not remove delivered-cost exposure from alternate supply routes.

Alufluoride widened its supplier base with a new source from April 2026, alongside long-term contracts with leading phosphatic fertiliser producers. Suppliers have indicated additional quantities as they upgrade fluorine recovery, according to the presentation, although all incoming material must meet Alufluoride's quality specification. These are the disclosed mechanisms for managing the feedstock that constrained Q1FY27 activity.

How much did Alufluoride's Q2FY27 revenue and profit increase?

Alufluoride's Q2FY27 operating revenue increased 17% year on year to Rs 63.9 crore from Rs 54.8 crore, while profit after tax (PAT) rose 91% to Rs 15.2 crore from Rs 7.9 crore. All operating revenue in both quarters came from aluminium fluoride, or ALF3, operations, while captive solar recorded no revenue in either period.

The sequential rebound followed a weaker Q1FY27 affected by the FSA shortfall, while the year-on-year comparison shows Q2FY27 operating revenue was Rs 9.1 crore higher than Q2FY26. Total income rose 18% to Rs 65.2 crore, including Rs 1.3 crore of other income, compared with Rs 55.2 crore and Rs 0.4 crore respectively a year earlier.

Alufluoride's earnings per share rose 91% to Rs 19.38 from Rs 10.14 in Q2FY26. Alufluoride also declared an interim dividend of Rs 2.5 per share. The presentation does not state a payout ratio, but it shows an H1FY27 interim dividend of Rs 2.5 per share and no comparable interim dividend for H1FY26.

Why did Alufluoride's Q2FY27 margins expand faster than revenue?

Alufluoride's EBITDA margin before other income rose to 36.1% in Q2FY27 from 25.4% in Q2FY26 because materials cost, net of inventory change, declined to 36.4% of revenue from 48.8%. The 1,070-basis-point increase accompanied 17% revenue growth and a 70% rise in reported EBITDA to Rs 24.4 crore.

The presentation attributes about Rs 7.9 crore of the Rs 9.2 crore year-on-year increase in PBT to lower materials cost. Higher revenue added about Rs 2.3 crore and other income about Rs 0.9 crore, while other costs reduced the improvement by about Rs 2.0 crore. PBT therefore rose 81% to Rs 20.5 crore from Rs 11.3 crore in Q2FY26.

Other income represented 6.4% of Q2FY27 PBT, compared with 3.5% in Q2FY26, but operating cost movements were the larger disclosed driver of the earnings increase. EBITDA before other income was Rs 23.1 crore against Rs 13.9 crore a year earlier, while cash operating cost was Rs 40.8 crore versus Rs 40.9 crore despite the Rs 9.1 crore increase in operating revenue.

Alufluoride says annual pricing agreed with smelters and forward buying of key raw materials supported Q2FY27 margins. The presentation also states that the inventory benefit will taper as stocks are consumed. The effective tax rate declined to 26.1% from 29.9%, helping PAT increase faster than the 81% rise in PBT.

What did the FSA disruption mean for Alufluoride's first half and balance sheet?

Alufluoride's H1FY27 operating revenue remained 8% below the prior-year period at Rs 90.5 crore because the Q1FY27 supply shortfall offset the Q2 recovery. Even so, H1FY27 EBITDA increased 43% to Rs 31.3 crore, PBT rose 51% to Rs 23.8 crore, and PAT grew 62% to Rs 17.9 crore from Rs 11.0 crore in H1FY26.

The two periods show the timing effect of the supply constraint. Q2FY27 revenue of Rs 63.9 crore was 2.4 times Q1FY27 as supply normalised, but H1FY27 revenue remained below H1FY26 revenue of Rs 98.6 crore. H1FY27 earnings per share increased to Rs 22.89 from Rs 14.11 despite the half-year revenue decline.

The final expansion phase was commissioned in June 2026 and was available for the whole of Q2FY27. At 30 September 2026, capital work in progress had fallen to Rs 1.8 crore from Rs 22.5 crore at 31 March 2026 as the expansion was capitalised, while net block, comprising property, plant and equipment, increased to Rs 92.9 crore from Rs 65.0 crore.

Working-capital balances increased alongside H1FY27 activity. Inventories were Rs 29.1 crore at September 2026 versus Rs 21.0 crore at March 2026, while trade receivables rose to Rs 18.9 crore from Rs 10.9 crore. Cash and investments increased Rs 17.9 crore to Rs 62.9 crore, borrowings rose Rs 9.4 crore to Rs 34.3 crore, and net worth increased Rs 14.9 crore to Rs 140.6 crore.

Conclusion

Alufluoride's Q2FY27 recovery combined restored FSA availability with full-quarter use of the final expansion phase. Operating revenue reached Rs 63.9 crore and was 2.4 times Q1FY27, while lower materials cost lifted EBITDA margin before other income to 36.1% from 25.4% and PAT to Rs 15.2 crore.

The next factor to watch is whether FSA availability and delivered cost remain stable as Alufluoride relies partly on distant suppliers where freight is rising with fuel prices. Management's disclosed measures include long-term contracts, a supplier source added in April 2026, potential additional quantities from fluorine-recovery upgrades, and forward-bought inventory whose margin benefit is expected to taper as stocks are consumed.