Laffans Petrochemicals Limited posts Q2 loss as income reverses

Laffans Petrochemicals Limited reported a Rs 1.92 crore loss for the quarter ended 30 September 2026 as other income was negative Rs 130.95 lakh, compared with positive Rs 6.02 crore in the preceding quarter, outweighing revenue from operations that rose to Rs 271.57 lakh.

What caused Laffans' loss in the September 2026 quarter?

Laffans made a Rs 1.92 crore loss after tax in the quarter ended 30 September 2026 because the reversal in other income and higher expenses outweighed higher operating revenue. Profit before tax was a loss of Rs 2.06 crore, against profit before tax of Rs 5.19 crore in the quarter ended 30 June 2026. The results reported no exceptional or extraordinary items in either quarter.

Other income moved from positive Rs 6.02 crore in the June 2026 quarter to negative Rs 130.95 lakh in the September 2026 quarter, a sequential movement of Rs 7.33 crore. Revenue from operations rose by Rs 159.57 lakh over the same period, from Rs 112.00 lakh to Rs 271.57 lakh, but this increase did not compensate for the change in other income.

Laffans' total expenses rose to Rs 3.46 crore from Rs 1.95 crore sequentially. Purchases of stock in trade increased to Rs 2.28 crore from Rs 85.38 lakh, while depreciation and amortisation rose to Rs 20.32 lakh from Rs 13.70 lakh. Finance cost increased to Rs 3.37 lakh from Rs 1.05 lakh, and other expenses were Rs 66.92 lakh compared with Rs 67.72 lakh.

The quarter's basic and diluted earnings per share were a loss of Rs 2.40, compared with earnings per share of Rs 6.21 in the June quarter. Paid-up equity share capital remained Rs 8.00 crore, with a face value of Rs 10 per share, across the reported quarterly periods.

How did Laffans' operating revenue compare with last year?

Laffans' revenue from operations rose to Rs 271.57 lakh in the September 2026 quarter from Rs 177.74 lakh in the quarter ended 30 September 2025. The Rs 93.83 lakh increase was reported within the company's only primary reportable segment, trading of chemicals and commodities.

The year-on-year result nevertheless remained a loss, although the deficit narrowed. Laffans recorded a Rs 1.92 crore loss after tax in the latest September quarter, compared with a Rs 4.31 crore loss in the corresponding quarter a year earlier. Other income was negative Rs 130.95 lakh, versus negative Rs 3.84 crore a year earlier, while total expenses increased to Rs 3.46 crore from Rs 2.55 crore.

The filing does not give volumes, selling prices or separate revenue figures for chemicals and commodities. It therefore does not identify whether the September 2026 operating-revenue increase arose from either of those activities, despite classifying both under a single reportable trading segment.

Why was Laffans profitable in the first half despite the quarterly loss?

Laffans was profitable in the half year ended 30 September 2026 because the Rs 4.97 crore profit after tax in the June quarter exceeded the Rs 1.92 crore September-quarter loss. The resulting half-year profit after tax was Rs 3.05 crore, compared with Rs 2.11 crore in the half year ended 30 September 2025.

Other income was Rs 4.71 crore during the latest half year, exceeding revenue from operations of Rs 3.84 crore. In the prior-year half, other income was Rs 3.57 crore and revenue from operations was Rs 2.09 crore. The comparison shows operating revenue increased by Rs 1.75 crore year on year, while other income increased by Rs 1.14 crore.

Laffans reported half-year profit before tax of Rs 3.14 crore, against Rs 2.18 crore a year earlier, despite total expenses rising to Rs 5.41 crore from Rs 3.48 crore. The half-year profit after tax of Rs 3.05 crore was also above the Rs 41.33 lakh reported for the full year ended 31 March 2026, though the filing gives no forecast for the remainder of the financial year.

The cash-flow statement shows a Rs 3.19 crore fair-valuation gain or loss adjustment and a Rs 74.59 lakh dividend classified as investing cash flow in the reconciliation of half-year profit before tax to operating cash flow. These disclosed adjustments indicate that the reported half-year result included material items beyond revenue from operations.

What do Laffans' cash flows and financial position show?

Laffans reported negative net cash flow from operating activities after tax of Rs 5.09 lakh for the half year ended 30 September 2026, compared with negative Rs 55,000 in the prior-year half. Profit before tax was Rs 3.14 crore, but the operating reconciliation included the Rs 3.19 crore fair-valuation adjustment, Rs 74.59 lakh dividend adjustment and Rs 34.02 lakh depreciation and amortisation.

Investing cash flow was negative Rs 49.50 lakh, following Rs 1.24 crore of payments for property, plant and equipment and Rs 74.59 lakh of dividend receipts. Financing cash flow was positive Rs 84.68 lakh, comprising Rs 89.10 lakh in borrowing proceeds less Rs 4.42 lakh of interest paid. Cash and cash equivalents consequently rose to Rs 30.34 lakh at 30 September 2026 from Rs 25,000 at the beginning of the half year.

Laffans' total assets increased to Rs 70.69 crore at 30 September 2026 from Rs 66.72 crore at 31 March 2026. Investments rose to Rs 56.55 crore from Rs 52.31 crore, and property, plant and equipment increased to Rs 7.18 crore from Rs 6.40 crore. Current assets fell to Rs 1.08 crore from Rs 2.21 crore, principally as other current assets declined to Rs 76.73 lakh from Rs 2.20 crore.

Total equity rose to Rs 67.08 crore from Rs 64.03 crore, while total liabilities increased to Rs 3.61 crore from Rs 2.69 crore. Non-current borrowings were Rs 1.24 crore at 30 September 2026, compared with Rs 34.63 lakh at 31 March 2026; current borrowings reduced to nil from Rs 1.18 lakh.

What did Laffans' auditor flag in the review?

Laffans' statutory auditor, Parveen Lokwani & Co., highlighted that the company did not provide bank statements, external confirmations and/or reconciliations for certain bank accounts. The review report dated 13 November 2026 said this prevented the auditor from verifying the recording and carrying balances of those accounts.

Management represented that the affected accounts were non-operational and that formalities with the respective banks remained pending. The auditor stated that its conclusion was not modified in respect of the matter. The report was a limited review performed under the Standard on Review Engagements 2410, which the auditor said provides less assurance than an audit and does not result in an audit opinion.

Laffans' Audit Committee reviewed, and its board approved, the quarter and half-year results on 13 November 2026. The financial statements were prepared under Indian Accounting Standards, or Ind AS, and the company disclosed one primary reportable segment of trading in chemicals and commodities.

Conclusion

Laffans' September-quarter loss was driven by the reversal from Rs 6.02 crore of other income in the June quarter to negative Rs 130.95 lakh, alongside a rise in expenses to Rs 3.46 crore. Operating revenue increased both sequentially and year on year, but the half-year profit of Rs 3.05 crore remained materially associated with Rs 4.71 crore of other income and disclosed valuation and dividend adjustments in the cash-flow reconciliation.

The disclosed unresolved matter to watch is completion of the bank-account formalities that management said were pending with the respective banks. The auditor could not verify balances of certain accounts without statements, confirmations or reconciliations, although it did not modify its review conclusion dated 13 November 2026.