Neogen Chemicals Limited Q2 revenue rose 42%, PAT up 144%

Neogen Chemicals Limited reported Q2 FY27 consolidated revenue of Rs 296 crore, 42% above Q2 FY26, while profit after tax (PAT) rose 144% to Rs 8.2 crore. The strongest disclosed revenue change came from Battery Chemicals, which generated Rs 37 crore versus Rs 5 crore a year earlier, as consolidated EBITDA increased 51% to Rs 45.3 crore.

How did Neogen Chemicals perform in Q2 FY27?

Neogen Chemicals increased consolidated revenue, earnings before interest, tax, depreciation and amortisation (EBITDA), and PAT in Q2 FY27. Revenue rose to Rs 296.0 crore from Rs 208.7 crore in Q2 FY26, EBITDA increased to Rs 45.3 crore from Rs 30.0 crore, and PAT reached Rs 8.2 crore from Rs 3.4 crore. Profit before tax increased 147% to Rs 12.7 crore.

The first-half comparison also showed higher consolidated earnings. In H1 FY27, revenue was Rs 546.3 crore, 38% above Rs 395.4 crore in H1 FY26; EBITDA rose 52% to Rs 93.6 crore; and PAT increased 86% to Rs 25.3 crore. Consolidated earnings per share were Rs 9.21 in H1 FY27, compared with Rs 5.18 in H1 FY26.

Standalone profit rose faster than consolidated profit in the quarter. Standalone revenue grew 39% to Rs 288.0 crore, EBITDA increased 54% to Rs 53.7 crore, and PAT rose 127% to Rs 21.1 crore. Management said the difference between standalone EBITDA of Rs 53.7 crore and consolidated EBITDA of Rs 45.3 crore reflected initial fixed-cost absorption at Neogen Ionics while its scale-up and capacity utilisation were ramping.

Which businesses drove Neogen Chemicals revenue growth?

Neogen Chemicals reported growth in Organic Chemicals, Inorganic Chemicals and Battery Chemicals, with Battery Chemicals recording the largest percentage increase. Battery Chemicals revenue was Rs 37 crore in Q2 FY27, versus Rs 5 crore in the segment table for Q2 FY26, a 585% increase. Elsewhere in the presentation, management described the same prior-year Battery Chemicals revenue as Rs 5.4 crore.

Organic Chemicals remained the largest disclosed revenue line, contributing Rs 238 crore in Q2 FY27 after a 29% year-on-year increase. Its H1 revenue rose 23% to Rs 432 crore. Management attributed improvement in core-segment volumes partly to Organolithium's expansion into high-growth emerging applications.

Inorganic Chemicals grew 140% to Rs 58 crore in Q2 FY27, exceeding the 29% growth reported for Organic Chemicals. In H1 FY27, Inorganic Chemicals increased 148% to Rs 114 crore and Battery Chemicals rose 409% to Rs 56 crore. The quarterly revenue mix was 66% domestic and 34% exports, including deemed exports; the presentation also classified 80% of revenue as organic and 20% as inorganic.

What changed in Neogen Chemicals costs and margins?

Neogen Chemicals expanded its consolidated EBITDA margin to 15.3% in Q2 FY27 from 14.4% in Q2 FY26, an increase of 95 basis points, with one basis point equal to one-hundredth of a percentage point. EBITDA increased 51%, ahead of the 42% revenue rise, while consolidated expenditure grew 40% to Rs 250.6 crore from Rs 178.7 crore.

Management said Q2 FY27 costs included the Dahej plant rebuild, tolling arrangements, Neogen Ionics capital expenditure and elevated input costs. It also cited Middle East geopolitical conflicts, supply-chain friction and feedstock-cost inflation. Standalone EBITDA margin rose to 18.6% from 16.9%, an increase of 174 basis points.

Higher interest and depreciation charges continued to affect earnings below EBITDA. Consolidated interest expense rose 43% to Rs 27.8 crore in Q2 FY27 from Rs 19.5 crore, while depreciation increased 20% to Rs 8.8 crore from Rs 7.3 crore. Nevertheless, consolidated profit before tax margin increased to 4.3% from 2.5%.

The consolidated PAT margin was 2.8%, compared with 1.6% in Q2 FY26, an increase of 117 basis points. For H1 FY27, EBITDA margin rose to 17.1% from 15.5%, while PAT margin increased to 4.6% from 3.5%. Management expects interest expense to decline through term-debt reduction using QIP proceeds and lower borrowing costs after the credit-rating upgrade.

How is Neogen Chemicals funding expansion and recovery?

Neogen Chemicals raised Rs 600 crore through its first QIP and reported consolidated total debt of Rs 1,560 crore in H1 FY27. Consolidated net debt was Rs 1,095 crore, and liquid investments, including fixed deposits, were Rs 465 crore as of September 30, 2026. The company said QIP proceeds would support debt repayment, incremental business requirements and growth opportunities.

Total consolidated assets stood at Rs 4,005 crore on September 30, 2026, compared with Rs 2,302 crore a year earlier. Shareholders' funds increased to Rs 1,578 crore from Rs 800 crore, while non-current liabilities rose to Rs 944 crore from Rs 665 crore. CRISIL Ratings revised the outlook on Rs 680 crore of long-term bank facilities and Rs 200 crore of non-convertible debentures to CRISIL A-/Stable from Negative.

The company reported cumulative recoveries of Rs 164 crore, comprising Rs 155 crore of on-account insurance claims and Rs 9 crore from salvage realisation. On October 29, 2026, it accepted an additional Rs 152 crore insurance claim for release in due course as part-payment. Total on-account claims received or receivable, including salvage scrap sales, stood at Rs 316 crore.

Neogen Chemicals approved an expansion of its Patancheru Organolithium facility from 300 metric tonnes per annum to 600 metric tonnes per annum, with investment of up to Rs 45 crore. Management disclosed potential revenue of Rs 150 crore to Rs 200 crore from this project, based on lithium prices. In Battery Chemicals, 200 metric tonnes per annum had been commissioned and another 1,000 metric tonnes per annum was commissioned in Q2 FY27.

Conclusion

Neogen Chemicals' Q2 FY27 outcome combined 42% consolidated revenue growth with a 51% increase in EBITDA and a 144% increase in PAT. Organic Chemicals remained the largest disclosed business at Rs 238 crore, while Battery Chemicals' rise to Rs 37 crore was the sharpest reported segment increase, despite the fixed-cost absorption associated with its ramp-up.

The next disclosed milestones are commissioning of 1,000 metric tonnes of lithium electrolyte salts and additives and 500 metric tonnes of additional intermediate capacity in H2 FY27. Management's expectation of lower interest expense depends on using the Rs 600 crore QIP proceeds for term-debt reduction, while the accepted Rs 152 crore insurance claim remains due for release as part-payment.