Prasol Chemicals Limited’s Mahad Plant Remains Loss-Making at 44%

Prasol Chemicals Limited’s Mahad Manufacturing Facility remained loss-making in Fiscal 2026 despite 44% utilisation, recording a Rs 12.172 crore loss before exceptional items and tax. Revenue rose to Rs 134.82 crore and the EBITDA loss narrowed to Rs 3.942 crore after the May 2024 restart, but output had not absorbed fixed costs.

Why is Prasol’s Mahad plant still loss-making at 44% utilisation?

Prasol’s Mahad plant remained loss-making because its higher production had reduced, but not eliminated, the fixed-cost burden of a greenfield facility. Earnings before interest, tax, depreciation and amortisation, or EBITDA, were negative Rs 3.942 crore in Fiscal 2026, compared with negative Rs 7.095 crore in Fiscal 2025 and negative Rs 14.934 crore in Fiscal 2024. EBITDA is the company’s reported measure of profit before exceptional items and tax, adjusted for finance costs, depreciation, impairment and other income.

Mahad revenue more than doubled to Rs 134.82 crore in Fiscal 2026 from Rs 64.396 crore in Fiscal 2025, and exceeded the Rs 43.531 crore reported in Fiscal 2024. Prasol attributes the Fiscal 2026 improvement to stabilised operations, a production ramp-up and a broader product portfolio, but says further utilisation is needed to absorb fixed costs and increase profitability.

The loss before exceptional items and tax narrowed by Rs 3.594 crore from Fiscal 2025 and by Rs 10.601 crore from Fiscal 2024, while remaining negative in each of the three reported years. The Fiscal 2026 results are standalone, whereas the Fiscal 2025 and Fiscal 2024 figures are consolidated, limiting direct like-for-like comparison across those periods.

What delayed Prasol’s Mahad plant stabilisation?

Prasol’s Mahad plant stabilisation was delayed by a regulatory closure after a gas-leak incident, as well as demand disruption in the agrochemical industry. The Maharashtra Pollution Control Board, or MPCB, directed the facility’s closure on October 27, 2023, after an October 5, 2023 incident during diethyl thiophosphoryl chloride, or DETC, manufacturing that involved releases of hydrogen sulphide, or H2S, and sulphur dioxide, or SO2.

The plant was shut from October 27, 2023 until May 3, 2024, when the MPCB allowed operations to resume subject to specified conditions. This interruption occurred during the operating ramp-up of a facility that began operations in 2020 and covers 119,423 square metres, one of Prasol’s two manufacturing facilities.

Prasol also identifies COVID-related disruption and global agrochemical-market destocking as causes of demand fluctuation after Mahad’s launch. The company cites the capital-intensive nature of specialty-chemical facilities, including research and development, pilot-scale testing and process optimisation, and says a new plant needs time to stabilise yield and quality.

How much does Mahad affect Prasol’s other operations?

Mahad is a distinct earnings drag because Prasol’s reported operations excluding Mahad were profitable in all three disclosed fiscal years. Revenue excluding Mahad reached Rs 1,097.773 crore in Fiscal 2026, or about 89% of Prasol’s total Rs 1,232.593 crore revenue from operations, while Mahad accounted for Rs 134.82 crore.

Operations excluding Mahad generated EBITDA of Rs 143.262 crore in Fiscal 2026, compared with Mahad’s negative Rs 3.942 crore. Profit before exceptional items and tax excluding Mahad was Rs 124.071 crore, while Mahad recorded a Rs 12.172 crore loss on the same basis.

The comparison shows a changed operating position at Mahad rather than a completed turnaround: its EBITDA loss fell from Rs 14.934 crore in Fiscal 2024 to Rs 3.942 crore in Fiscal 2026, but the plant continued to reduce the profit generated outside Mahad. Prasol’s Fiscal 2026 company-wide revenue from operations was Rs 1,232.593 crore, with operating EBITDA of Rs 139.320 crore.

What is Prasol’s plan for Mahad profitability?

Prasol plans to expand Mahad capacity and its product portfolio to raise utilisation and improve fixed-cost absorption. The company says the Fiscal 2026 improvement followed higher production and more products at Mahad, and its stated strategy is to continue the facility’s turnaround through further capacity and portfolio expansion.

Prasol has access to two additional Mahad land parcels in the Mahad Five Star Industrial Area: 34,423 square metres at Plot FS 26 and 40,000 square metres at Plot FS 31. The disclosure does not provide a Mahad expansion timetable, an investment amount, an additional-capacity figure, a target utilisation rate or a stated date for profitability.

Prasol also intends to enter a renewable power purchase agreement to reduce power costs at Mahad. A power purchase agreement is a contract to buy electricity, but the company has not disclosed a supplier, contracted capacity, tariff, expected savings or execution date. Its product-development pipeline comprised 40 products as of June 30, 2026, including nine that had cleared the pilot stage, although the disclosure does not identify which products may be made at Mahad.

Conclusion

Mahad’s Fiscal 2026 figures show operational recovery without profitability. Revenue of Rs 134.82 crore, 44% utilisation and a narrower Rs 3.942 crore EBITDA loss indicate progress from Fiscal 2024 and Fiscal 2025, but the Rs 12.172 crore loss before exceptional items and tax shows that the greenfield facility had not yet covered its full cost base.

The next measures to watch are Prasol’s disclosed capacity and product expansion, progress on its intended renewable power purchase agreement and whether utilisation rises enough to absorb fixed costs. The timing and scale of those actions remain unresolved because Prasol has not disclosed a Mahad profitability date, a utilisation target or the financial terms of the power arrangement.