Jindal Poly Films Q3 Loss Hits Rs 96 Crore Amid Sales Plunge

Introduction

Jindal Poly Films Limited announced a challenging third quarter for the fiscal year 2026, reporting a consolidated net loss of Rs 96.41 crore for the period ending December 31, 2025. This marks a significant downturn from the Rs 4.11 crore net profit recorded in the same quarter of the previous year. The company's performance was heavily impacted by a steep decline in sales, which fell by 68.66% year-on-year. However, the financial results presented a mixed picture, as the standalone entity managed to post a profit, highlighting severe pressures within its subsidiaries and the core packaging business.

Consolidated Financial Performance

The consolidated figures reveal the extent of the operational difficulties faced by the company. Revenue from operations for Q3 FY26 stood at Rs 371.66 crore, a sharp drop from Rs 1,185.94 crore in Q3 FY25. This substantial contraction in the top line led to a negative operating profit margin (OPM) of -20.81%, a stark contrast to the 6.42% margin reported in the corresponding quarter of the previous year. The loss before tax was Rs 78.03 crore, reversing a profit before tax of Rs 18.29 crore in the December 2024 quarter.

Standalone Results Offer a Glimmer of Hope

In sharp contrast to the consolidated losses, Jindal Poly Films' standalone operations reported a net profit of Rs 75.41 crore for Q3 FY26. This represents a significant turnaround from the standalone net loss of Rs 2.51 crore in the same period last year. The standalone total income surged to Rs 104.72 crore, largely driven by other income. This divergence between standalone profitability and consolidated losses points towards challenges concentrated in the company's subsidiaries and specific business segments, rather than a universal decline across all operations.

Operational Headwinds and Key Challenges

Several factors contributed to the company's weak consolidated performance. A major event was a fire incident at its Nashik plant in May 2025, which disrupted production and supply chains. In relation to the assets destroyed, the company has deposited Rs 82.24 crore with the GST department on a provisional basis and under protest. This incident has had a lingering effect on the company's operational capacity and financial accounting, with inventory being carried at cost pending a final assessment.

Furthermore, the company made provisions for new labour codes, which added to its expense burden during the quarter. These regulatory changes, combined with the operational setback from the fire, created a challenging business environment.

Segment Performance Analysis

The packaging films segment, which is the core of Jindal Poly Films' continuing operations, faced a particularly difficult quarter. Revenue from this segment plummeted to Rs 301.78 crore in Q3 FY26 from Rs 1,119.95 crore in the corresponding quarter of the previous year. The segment recorded a loss before finance costs and tax of Rs 56.92 crore, reflecting the severe market conditions and internal operational issues that have impacted its primary business line.

Strategic Restructuring: Demerger of Nonwoven Business

As part of a strategic realignment, Jindal Poly Films has demerged its nonwoven business into a separate entity, Global Nonwovens Limited. Consequently, this business is now classified as a discontinued operation in the financial statements. For Q3 FY26, the discontinued nonwoven operations generated a net profit of Rs 2.01 crore on a total income of Rs 195.09 crore. This was a significant drop from the Rs 21.45 crore profit reported by the segment in Q3 FY25, indicating that this business also faced its own set of challenges before the demerger.

Nine-Month Performance Overview

The weak performance in the third quarter has impacted the company's results for the first nine months of FY26. On a consolidated basis, for the period from April to December 2025, the company reported a net loss of Rs 73.81 crore. This is a reversal from the net profit of Rs 288.80 crore earned during the same nine-month period in the previous fiscal year. The cumulative revenue from operations also saw a significant decline, standing at Rs 1,695.65 crore compared to Rs 3,419.26 crore a year earlier.

Analysis and Outlook

The divergence between Jindal Poly Films' standalone and consolidated results for Q3 FY26 is the central theme of its recent performance. While the standalone entity's profitability, bolstered by other income, is a positive sign, the deep losses at the consolidated level cannot be overlooked. These losses are rooted in the operational struggles of the core packaging films business and the financial impact of the Nashik plant fire. The sharp decline in revenue and negative operating margins underscore the intensity of these pressures. The ongoing demerger of the nonwoven business is a key strategic move aimed at streamlining operations and allowing management to focus on the core packaging segment. Investors will be closely watching for signs of recovery in this core business and the final financial impact of the fire incident in the upcoming quarters.