Gujarat Themis RoCE falls to 14.5% as capital base expands

Gujarat Themis Biosyn Limited reported return on capital employed of 14.5% in FY25-26, down from 57.9% in FY21-22, after capital expenditure over the preceding two years increased capital employed and the asset base, according to its presentation. Revenue rose to Rs 165.8 crore in FY25-26, but profit after tax was Rs 46.7 crore.

How far did Gujarat Themis's return ratios fall?

Gujarat Themis's return ratios declined across each of the five reported financial years, with return on capital employed, or RoCE, falling 43.4 percentage points to 14.5% in FY25-26 from 57.9% in FY21-22. Return on assets, or RoA, declined to 9% from 36%, while return on equity, or RoE, fell to 16.2% from 42.2% over the same period.

The presentation attributes the movement to capital expenditure during the last two years that raised both capital employed and the asset base. Gujarat Themis defines RoCE as earnings before interest and tax, or EBIT, divided by shareholders' funds plus total debt less non-current investments; it does not disclose the annual EBIT or capital-employed values used in the calculation.

Gujarat Themis defines RoA as net profit divided by average total assets and RoE as net profit divided by net worth. The FY25-26 gap between the measures was material: RoE was 16.2%, 7.2 percentage points above RoA of 9%, while RoCE was 14.5%.

What changed in Gujarat Themis's standalone balance sheet?

Gujarat Themis's standalone total assets increased to Rs 503.4 crore at FY25-26 end from Rs 301.3 crore at FY24-25 end, before reaching Rs 1,893.4 crore at 30 September 2026. The half-year balance sheet date is not directly comparable with the two full-year closing dates, but it records a substantially larger asset base after FY25-26.

Standalone non-current assets rose to Rs 414.6 crore at FY25-26 end from Rs 249.3 crore a year earlier. Property, plant and equipment increased to Rs 286.9 crore from Rs 40.6 crore, while capital work in progress declined to Rs 121.1 crore from Rs 184.4 crore, showing that the composition of non-current assets changed between the two periods.

At 30 September 2026, the standalone balance sheet included Rs 768.1 crore of financial loans and Rs 475.1 crore of other financial assets within non-current assets. Property, plant and equipment was Rs 280.1 crore and capital work in progress was Rs 173.7 crore, while current assets included cash and cash equivalents of Rs 80.6 crore and trade receivables of Rs 70.8 crore.

Did Gujarat Themis's earnings keep pace with its capital expansion?

Gujarat Themis reported higher revenue in FY25-26 but lower profit after tax, or PAT, than in FY24-25. Revenue increased to Rs 165.8 crore from Rs 150.8 crore, and earnings before interest, tax, depreciation and amortisation, or EBITDA, rose to Rs 75.5 crore from Rs 68.8 crore, but PAT decreased to Rs 46.7 crore from Rs 48.8 crore.

Margins also moved lower in FY25-26. EBITDA margin was 45.6%, compared with 45.7% in FY24-25 and 50.5% in FY21-22, while PAT margin was 28.2%, compared with 32.3% and 38.0%, respectively. The presentation states that EBITDA excludes other income and that the annual financial highlights are on a standalone basis.

For H1 FY27, Gujarat Themis reported standalone revenue of Rs 91.2 crore, EBITDA of Rs 38.5 crore and PAT of Rs 19.5 crore. EBITDA margin was 42.2% and PAT margin was 21.4%; these half-year figures should not be treated as a like-for-like comparison with full-year FY25-26 margins of 45.6% and 28.2%.

How did Gujarat Themis finance the larger asset base?

Gujarat Themis reported standalone shareholders' funds of Rs 1,055.3 crore at 30 September 2026, compared with Rs 287.8 crore at FY25-26 end. Non-current borrowings rose to Rs 709.7 crore from Rs 128.1 crore, while short-term borrowings increased to Rs 52.9 crore from Rs 31.8 crore.

Current liabilities were Rs 118.0 crore at 30 September 2026, compared with Rs 79.1 crore at FY25-26 end. The H1 FY27 total included trade payables of Rs 47.2 crore, other financial liabilities of Rs 8.2 crore and current tax liability of Rs 1.8 crore.

The consolidated H1 FY27 balance sheet was larger than the standalone balance sheet, with total assets of Rs 2,673.8 crore and non-current borrowings of Rs 1,366.2 crore. Consolidated assets included property, plant and equipment of Rs 858.9 crore and goodwill of Rs 1,061.4 crore; these figures should not be combined with the standalone annual revenue, profit and return-ratio series.

What expansion plans could affect Gujarat Themis's capital needs?

Gujarat Themis says it recently began commercial operations at a new active pharmaceutical ingredient, or API, facility as part of its forward-integration strategy. It is also identifying products with domestic and export potential and intends to enhance fermentation capacity at its current location, but the presentation does not disclose capacity, investment cost, commissioning dates or return targets for these initiatives.

The company describes a wind-and-solar hybrid renewable-power project of about 18 megawatts for captive consumption. Management says the project is intended to reduce dependence on grid electricity, lower power costs and support margin stability, although the presentation gives no project cost, output forecast or completion schedule.

Gujarat Themis also plans a research and development lab for technology development, new products and assessing applications for existing products. Its stated strategy includes exploring inorganic opportunities globally, expanding geographical reach and therapy areas, and considering organic and inorganic specialty-chemical growth, without identifying transaction targets or committed spending.

Conclusion

Gujarat Themis's disclosed figures show a sustained decline in returns alongside a larger capital and asset base. RoCE fell from 57.9% in FY21-22 to 14.5% in FY25-26, while RoA declined from 36% to 9% and RoE from 42.2% to 16.2%. FY25-26 revenue increased to Rs 165.8 crore, but PAT fell to Rs 46.7 crore and the PAT margin narrowed to 28.2%.

The next disclosed developments to watch are commercial progress at the new API facility, fermentation-capacity expansion and the approximately 18-megawatt hybrid renewable-power project. Management's plans for new products, research and development, geographical diversification and possible inorganic growth could further affect the balance sheet, but the presentation does not state spending budgets, completion dates or financial-return targets.