Jyothy Labs September profit falls 88% as costs increase

Jyothy Labs Limited reported net profit of Rs 10.60 crore for the quarter ended September 30, 2026, down 88% from Rs 87.76 crore a year earlier, as revenue from operations rose to Rs 760.04 crore but total expenses reached Rs 759.29 crore.

Why did Jyothy Labs profit fall in the September quarter?

Jyothy Labs’ profit fell because expenses grew faster than revenue in the quarter ended September 30, 2026. Total expenses rose by Rs 124.94 crore year on year to Rs 759.29 crore, while revenue from operations increased by Rs 23.98 crore to Rs 760.04 crore. Profit before tax consequently fell to Rs 16.38 crore from Rs 118.69 crore.

The largest change was in cost of materials consumed, which increased to Rs 454.75 crore from Rs 383.78 crore, a rise of Rs 70.97 crore. The inventory line also moved adversely: changes in inventories of finished goods, stock in trade and work-in-progress were an expense of Rs 11.62 crore, compared with a Rs 29.50 crore reduction in expense in the September 2025 quarter. That created an unfavourable year-on-year swing of Rs 41.12 crore.

Tax expense declined to Rs 5.78 crore from Rs 30.93 crore, following the lower pre-tax profit, but this did not offset the operating cost movement. Net profit was Rs 10.60 crore, compared with Rs 87.76 crore a year earlier, while basic and diluted earnings per share were 29 paise, against Rs 2.39. These per-share figures are not annualised.

How did Jyothy Labs revenue and expenses change?

Jyothy Labs increased September-quarter revenue from operations by about 3.3% year on year to Rs 760.04 crore, but revenue was lower than Rs 773.40 crore in the preceding June 2026 quarter. Total income, which includes other income, was Rs 775.67 crore in September 2026, compared with Rs 753.04 crore a year earlier and Rs 791.05 crore in June 2026.

Material consumption represented the principal increase in expenses, rising Rs 70.97 crore from the comparable quarter. Purchases of stock in trade also increased to Rs 29.39 crore from Rs 28.09 crore. Employee benefits expense rose to Rs 89.62 crore from Rs 84.77 crore, depreciation and amortisation increased to Rs 17.09 crore from Rs 15.20 crore, and other expenses rose to Rs 98.97 crore from Rs 89.18 crore.

Not every cost line increased. Advertisement and sales promotion expense declined by Rs 4.95 crore year on year to Rs 56.52 crore, while finance cost decreased by Rs 0.03 crore to Rs 1.33 crore. However, those reductions were smaller than the higher material cost and the reversal in the inventory movement, leaving total expenses about 19.7% above the year-earlier Rs 634.35 crore.

The half-year numbers show a similar contrast between sales and earnings. Revenue from operations for the six months ended September 30, 2026 was Rs 1,533.44 crore, up from Rs 1,487.27 crore in the corresponding 2025 period. Yet profit before tax fell to Rs 81.36 crore from Rs 246.22 crore, and net profit declined to Rs 58.24 crore from Rs 184.55 crore.

What do Jyothy Labs half-year cash flows show?

Jyothy Labs used Rs 12.83 crore in operating activities during the half year ended September 30, 2026, compared with generating Rs 196.45 crore in the same period a year earlier. Profit before tax was Rs 81.36 crore, down Rs 164.86 crore year on year, and cash generated from operations was Rs 12.04 crore before net taxes paid of Rs 24.87 crore.

Working-capital movements added to the difference. Inventories absorbed Rs 82.91 crore of cash in the 2026 half year, compared with Rs 7.73 crore in the prior-year period. Trade receivables released Rs 72.86 crore of cash in 2026, whereas they had absorbed Rs 63.22 crore a year earlier, but that inflow did not fully counter the inventory increase and reduced trade payables of Rs 31.16 crore.

The balance sheet recorded inventories of Rs 428.35 crore at September 30, 2026, up from Rs 344.41 crore at March 31, 2026. Trade receivables decreased to Rs 183.52 crore from Rs 256.60 crore over the same period. Cash and cash equivalents stood at Rs 22.12 crore, compared with Rs 52.59 crore at the March year-end, while bank balances other than cash and cash equivalents rose to Rs 345.23 crore from Rs 257.44 crore.

Investing activities generated Rs 127.14 crore in the six-month period, compared with cash used of Rs 117.42 crore in the prior-year period. The 2026 period included Rs 1,187.96 crore of mutual-fund redemption proceeds and Rs 965.50 crore invested in mutual funds. Financing activities used Rs 144.78 crore, including dividend payments of Rs 128.53 crore.

What are the terms of Jyothy Labs’ buyback?

Jyothy Labs’ board approved a buyback of up to 68,37,210 fully paid equity shares at Rs 215 per share through the tender-offer route on November 4, 2026. The total payable amount is capped at Rs 147 crore, excluding costs and taxes, and represents 1.86% of the total paid-up equity capital as of March 31, 2026.

The record date for determining eligible shareholders is November 11, 2026. The buyback will be available to members or beneficial owners whose names appear in the register of members or beneficial-owner lists at the close of that date. The board may, until one working day before the record date, increase the buyback price and reduce the number of shares without changing the buyback size.

Jyothy Labs stated that its promoter and promoter group informed it on November 4, 2026 that they do not intend to participate in the buyback. The disclosed buyback size represents 9.70% of the aggregate fully paid-up equity share capital and free reserves based on the audited financial statements for the year ended March 31, 2026.

The September-quarter and half-year financial results were reviewed by the audit committee and approved by the board on November 4, 2026. B S R & Co. LLP issued a limited review report dated November 4, 2026, stating that nothing had come to its attention to indicate the results lacked required disclosures or contained a material misstatement.

Conclusion

Jyothy Labs delivered higher September-quarter revenue of Rs 760.04 crore, but its Rs 70.97 crore increase in material consumption and Rs 41.12 crore adverse inventory-movement swing coincided with net profit falling to Rs 10.60 crore. The half-year pattern was also higher sales alongside lower earnings, with net profit of Rs 58.24 crore on revenue of Rs 1,533.44 crore.

The next disclosed event is the November 11, 2026 record date for the Rs 147 crore tender-offer buyback at Rs 215 per share. Investors can watch whether the inventory balance of Rs 428.35 crore and operating cash outflow of Rs 12.83 crore for the first half change in subsequent financial disclosures.