Sigachi Q1 FY27: A steadier quarter, with mix shift and capacity bets in focus

Sigachi Industries began FY27 with a quarter that looked operationally steady but still mid-recovery in profitability versus last year. Revenue from operations in Q1 FY27 stood at INR121.3 crore, down 5.38% year-on-year and marginally lower quarter-on-quarter. Despite the softer top line, EBITDA improved sequentially to INR16.5 crore, and PAT rose to INR8.2 crore. EBITDA margin came in at 13.6% and PAT margin at 6.76%.

The quarter’s most important signal was not only the headline numbers, but a visible shift in revenue mix and management’s emphasis on capacity restoration, new excipient categories, and API scale-up. The investor presentation highlighted that MCC’s share of revenue reduced to 68% in Q1 FY27 from 80% in Q1 FY26, while API contribution rose to 15% from 7%. Allied trades also increased to 6% from 3%.

Q1 FY27 performance: stable operations, better QoQ profitability

The income statement shows why the quarter looked better sequentially despite flattish revenue. Total expenses declined slightly quarter-on-quarter to INR104.8 crore. Finance cost reduced to INR3.0 crore from INR4.3 crore in Q4 FY26, while EBITDA improved by 7.14% QoQ.

Management shared that overall utilisation in Q1 FY27 was 76.8% at the company level, with Dahej at 76.5% and Jhagadia at 77.16%. The company also indicated quarter-on-quarter improvement in utilisation and debottlenecking efforts.

The company’s segment numbers, as stated by the CFO on the call, help anchor the mix narrative. MCC delivered INR82.74 crore in Q1 FY27, Operations and Management contributed INR13.06 crore, and the API segment delivered INR21.68 crore.

Note: Q1 FY26 PAT included exceptional items in the reported number per the presentation income statement.

Excipients remain the anchor, but capacity and product mix are the key levers

Sigachi reiterated that its cellulose-based excipient capacity is 18,000 MTPA, with exports accounting for over 53.5% of production. The strategic centerpiece remains the 12,000 MTPA expansion at Dahej-2, which management said is progressing on schedule, with commissioning targeted by Q2 FY28. Post commissioning, total cellulose-based excipient capacity is expected to increase to 30,000 MTPA.

A recurring topic in the call was the company’s prior capacity shortfall. Management stated it had a reduction of about 6,000 MTPA capacity and that the inability to supply led customers to shift to other approved suppliers. The company’s message was that customer relationships built over three decades should allow it to regain share once supply normalises.

The quarter also featured a product-led push toward higher-value excipients and food and nutrition applications. Management announced the launch of HiCel SMCC Nutra, a blend of microcrystalline cellulose and magnesium aluminometasilicate, aimed at improving flowability, compressibility, and processing in nutraceutical formulations.

Alongside MCC, Sigachi is advancing a 1,800 ton Croscarmellose Sodium facility at Dahej SEZ. Management described CCS as a disintegrant that complements MCC’s binder role in tablet formulations, and positioned the project as part of its move into higher-value excipient categories and a stronger mix.

On market sizing, management stated the CCS market in India is estimated at about $100 million, with average realisations in the range of INR1,200 to INR1,500 per kg for certain occasions and specific grades. The company indicated it is targeting CCS mainly for export markets, and that export customers have been making inquiries for CCS since they already source MCC.

API business: revenue up, portfolio expansion continues

The API business was a larger contributor in this quarter compared to the year-ago period. The CFO stated API revenue was INR21.68 crore in Q1 FY27. Management referenced new molecules such as Sparsentan and Bempedoic Acid as part of the business ramp.

On guidance, management reiterated the earlier revenue guidance of INR650 crore to INR675 crore for FY27 and reiterated a full-year EBITDA margin expectation of around 18%. For the API business, management referenced an annual revenue target in the range of INR100 crore to INR110 crore, with stronger quarters expected later in the year.

Separately, the presentation and management remarks highlighted an API R and D Center in Hyderabad that is now fully operational, bringing API development and analytical work under one roof. Management also referred to the CEP filing pipeline as part of its longer-term regulated market plan, though no quarter-specific milestones were disclosed.

Capital allocation, insurance and funding: near-term watch items

Sigachi guided capex of more than INR100 crore for FY27 and INR150 crore to INR200 crore for FY28. On funding, the CFO stated the company could use bank finance or equity, and also mentioned discussions around a preferential issue, without finalising a structure during the call.

Insurance settlement remained a key investor question. Management stated the assessment has been completed and expects claim settlement by September, either full with some discount or an ad hoc amount. The CFO also stated that a business interruption claim eligibility is INR16.5 crore, but that it may take another three to four months.

Working capital was also discussed. The CFO stated receivable days are around 93 to 94 days currently, with an aim to bring them to around 90 days by year-end, and further reduce to 75 to 80 days over time.

Takeaways

Q1 FY27 looked like a quarter of stabilisation rather than acceleration. Revenue was slightly lower, but profitability improved sequentially. The bigger narrative is the company’s plan to restore and expand capacity, broaden its excipient basket via CCS, and sustain the API ramp-up.

The next few quarters will likely be judged on three things that management itself highlighted: utilisation moving closer to the declared run-rate, delivery against the Dahej-2 and CCS timelines, and clarity on capex funding and insurance cash flows. Sigachi’s guidance remains unchanged, but execution and timing will determine how quickly the business returns to its pre-disruption trajectory.