GSP Crop Science Q2 profit falls 24% as revenue rises 20%

GSP Crop Science Limited reported consolidated net profit of Rs 44.64 crore for the quarter ended September 30, 2026, down 24% year on year despite revenue from operations rising 20% to Rs 558.42 crore. For the six months ended September 30, 2026, GSP Crop Science reported an operating cash outflow of Rs 83.43 crore.

Why did GSP Crop Science's Q2 profit fall despite revenue growth?

GSP Crop Science's quarterly profit fell because total expenses increased faster than total income. Revenue from operations rose from Rs 467.29 crore in the quarter ended September 30, 2025 to Rs 558.42 crore in the latest quarter, an increase of 19.5%, while total expenses increased 28.8% to Rs 502.38 crore from Rs 390.19 crore.

Total income rose to Rs 562.82 crore from Rs 468.05 crore, but profit before tax fell to Rs 60.45 crore from Rs 77.86 crore. Net profit declined to Rs 44.64 crore from Rs 58.49 crore, while basic and diluted earnings per share were Rs 9.60, compared with Rs 15.19 in the corresponding quarter.

The auditor said the September 2025 consolidated comparative figures had been approved by the board but were not subjected to audit or review. The September 2026 quarter and six-month results were subject to a limited review and were approved by the audit committee and board on November 13, 2026.

Which costs increased during GSP Crop Science's Q2?

GSP Crop Science's cost of materials consumed rose to Rs 316.46 crore in the September 2026 quarter from Rs 269.61 crore a year earlier. Other expenses increased to Rs 90.03 crore from Rs 67.73 crore, employee-benefit expense reached Rs 29.59 crore from Rs 27.37 crore, and depreciation and amortisation rose to Rs 10.06 crore from Rs 7.15 crore.

The inventory movement was also higher year on year. Changes in inventories of finished goods, stock-in-trade and work in progress were an expense of Rs 44.55 crore in the latest quarter, compared with Rs 7.81 crore in the September 2025 quarter. Finance cost was the main offset, declining to Rs 7.49 crore from Rs 8.93 crore.

Sequentially, revenue rose from Rs 386.00 crore in the quarter ended June 30, 2026 to Rs 558.42 crore in the September quarter, while net profit increased from Rs 26.39 crore to Rs 44.64 crore. Inventory changes moved from a Rs 54.07 crore reduction in the June quarter to a Rs 44.55 crore expense in the September quarter.

What caused GSP Crop Science's half-year operating cash outflow?

GSP Crop Science used Rs 83.43 crore in operating activities in the six months ended September 30, 2026, compared with generating Rs 26.60 crore in the corresponding 2025 period. Profit before tax fell to Rs 95.81 crore from Rs 107.75 crore, while operating profit before working-capital changes declined to Rs 118.86 crore from Rs 140.64 crore.

Working-capital changes accounted for the reversal in operating cash flow. Inventories used Rs 46.89 crore of cash, compared with generating Rs 24.57 crore in the prior-year half. Trade receivables, loans and other financial and non-financial assets used Rs 346.83 crore, compared with Rs 270.31 crore a year earlier.

Higher trade payables, provisions and other financial and non-financial liabilities supplied Rs 212.69 crore, up from Rs 154.34 crore in the earlier period. Cash used from operations was Rs 62.17 crore, against cash generated of Rs 49.23 crore a year earlier, and net tax payments of Rs 21.26 crore resulted in the Rs 83.43 crore operating cash outflow.

How did GSP Crop Science's balance sheet and cash position change?

GSP Crop Science's trade receivables rose to Rs 827.48 crore at September 30, 2026 from Rs 552.57 crore at March 31, 2026, an increase of Rs 274.91 crore. Inventories increased to Rs 403.21 crore from Rs 356.23 crore, while cash and cash equivalents fell to Rs 23.33 crore from Rs 155.32 crore.

Investing activities used Rs 54.38 crore in the first half, compared with Rs 36.08 crore in the prior-year period. Purchases of property, plant and equipment, intangible assets, capital work-in-progress, intangible assets under development and capital advances totalled Rs 89.26 crore, partly offset by Rs 23.71 crore of proceeds from disposal of property, plant and equipment.

Financing activities generated Rs 6.12 crore, compared with Rs 4.61 crore a year earlier. GSP Crop Science received Rs 62.05 crore from long-term borrowings, repaid Rs 7.57 crore of such borrowings, and recorded a net Rs 28.99 crore reduction in short-term borrowings.

What corporate actions and reporting matters should readers note?

GSP Crop Science has one reportable business segment, agrochemicals, under Indian Accounting Standard 108. Its consolidated results include Rajdhani Petrochemicals Private Limited, GSP Intermediates Private Limited and GSP Agroquimica Do Brasil LTDA, all identified in the filing as subsidiaries.

The board approved a scheme to merge Rajdhani Petrochemicals Private Limited and the manufacturing undertaking of GSP Intermediates Private Limited into GSP Crop Science. The scheme has an appointed date of April 1, 2026 and was filed with the National Company Law Tribunal, Ahmedabad on October 28, 2026; its financial effect has not been recognised pending regulatory and statutory approvals.

GSP Crop Science paid a final dividend of Rs 1 per share for financial year 2025-26 on September 25, 2026, following shareholder approval at the annual general meeting on September 18, 2026. The company also said final Central Rules under the Labour Codes were notified during the quarter and that it is monitoring state rules and government clarification for any consequential accounting impact.

Conclusion

GSP Crop Science's September 2026 quarter showed that a Rs 91.13 crore year-on-year increase in revenue did not translate into higher earnings, as total expenses increased by Rs 112.19 crore and net profit declined by Rs 13.85 crore. Over the first half, working-capital movements turned operating cash flow to an outflow of Rs 83.43 crore.

The next disclosures should show whether trade receivables of Rs 827.48 crore and inventories of Rs 403.21 crore change, and whether this affects operating cash flow. Investors can also watch for National Company Law Tribunal and other approvals for the merger scheme appointed from April 1, 2026, and any Labour Code impact after state rules and government clarifications are finalised.