Sobhagya Mercantile Limited metal-sale loss is Rs 12.71 crore

For the half year ended September 30, 2026, Sobhagya Mercantile reported a Rs 12.71 crore EBITDA loss in its metal-sale segment, while segment revenue rose sequentially to Rs 11.14 crore in the September quarter from Rs 7.55 crore in the June quarter. Half-year metal-sale sales were Rs 18.69 crore.

Did metal-sale revenue growth reduce its loss?

No. Sobhagya Mercantile’s metal-sale, or stone-crusher, segment made an EBITDA loss of Rs 12.71 crore in the half year ended September 30, 2026, compared with EBITDA of Rs 2.11 crore in the corresponding half of 2025. The result also exceeded the segment’s Rs 7.10 crore EBITDA loss for the full year ended March 31, 2026.

The September-quarter loss did narrow from the preceding quarter. Metal-sale EBITDA was negative Rs 5.05 crore for the quarter ended September 30, 2026, versus negative Rs 7.66 crore for the quarter ended June 30, 2026. Revenue rose by Rs 3.59 crore sequentially to Rs 11.14 crore, from Rs 7.55 crore, but the segment remained in loss.

The year-on-year comparison was less favourable. Half-year metal-sale revenue declined to Rs 18.69 crore from Rs 24.63 crore in the half year ended September 30, 2025, a reduction of Rs 5.94 crore. The segment’s EBITDA therefore moved by Rs 14.82 crore, from a Rs 2.11 crore profit to a Rs 12.71 crore loss.

Earnings before interest and tax, or EBIT, also stood at a Rs 12.71 crore loss for metal sale in the current half year. In the prior-year half, the segment reported EBIT of Rs 1.96 crore and EBITDA of Rs 2.11 crore. The segment disclosure does not separately identify a depreciation and amortisation charge for metal sale in the current half.

How did engineering compare with metal sale?

Engineering remained Sobhagya Mercantile’s reported source of segment profitability, generating EBITDA of Rs 38.21 crore in the half year ended September 30, 2026. This was Rs 10.88 crore higher than Rs 27.33 crore a year earlier, although engineering revenue declined to Rs 66.94 crore from Rs 78.91 crore.

The contrasting segment movements shaped the total. Engineering revenue fell by Rs 11.96 crore year on year while its EBITDA increased, whereas metal-sale revenue declined by Rs 5.94 crore and its EBITDA moved into loss. Total segment EBITDA was Rs 25.50 crore in the latest half year, down from Rs 29.44 crore in the prior-year half.

The quarterly trend also differed between the businesses. Engineering revenue was Rs 33.12 crore in the September 2026 quarter, below Rs 33.82 crore in the June quarter, while its EBITDA fell to Rs 16.24 crore from Rs 21.97 crore. Metal-sale revenue increased over the same periods, and its loss narrowed by Rs 2.60 crore.

What did the segment results mean for company profit?

Sobhagya Mercantile reported standalone revenue from operations of Rs 85.64 crore for the half year ended September 30, 2026, down from Rs 103.54 crore a year earlier. Profit before tax was Rs 12.58 crore, compared with Rs 13.81 crore, and profit after tax was Rs 9.41 crore, compared with Rs 10.32 crore.

Segment EBITDA is not the same as reported profit before tax. The segment statement shows Rs 8.12 crore of finance cost, Rs 16.92 crore of other unallocable expenses and Rs 4.98 crore of other income for the latest half year. Those items reduced total segment EBIT of Rs 25.33 crore to the reported profit before tax of Rs 12.58 crore.

Other income increased sharply from Rs 0.23 lakh in the prior-year half to Rs 4.98 crore in the latest half. Current tax was Rs 3.17 crore for the six months ended September 30, 2026, against Rs 3.49 crore a year earlier, resulting in the reported decline in profit after tax despite the engineering segment’s higher EBITDA.

What balance-sheet and cash-flow figures relate to metal sale?

Sobhagya Mercantile reported metal-sale segment assets of Rs 44.40 crore at September 30, 2026, up from Rs 35.98 crore at March 31, 2026 but below Rs 58.33 crore at September 30, 2025. Segment liabilities were Rs 20.74 crore, compared with Rs 19.12 crore at the March 2026 year-end and Rs 30.48 crore a year earlier.

Engineering assets were Rs 157.02 crore at September 30, 2026, compared with Rs 44.40 crore for metal sale. Engineering liabilities were Rs 78.42 crore, while metal-sale liabilities were Rs 20.74 crore. Unallocable assets of Rs 236.81 crore brought total segment assets to Rs 438.24 crore, and total segment liabilities were Rs 180.87 crore.

The standalone cash-flow statement recorded negative cash from operating activities of Rs 89.70 crore for the half year ended September 30, 2026, after working-capital changes. It included increases in trade receivables of Rs 39.44 crore, other current assets of Rs 26.19 crore and other financial assets of Rs 12.63 crore, alongside an inventory movement of Rs 23.74 crore.

The company also disclosed Rs 28.41 crore of investment in promoter-group special-purpose vehicles through equity shares and optionally convertible debentures during the period. It separately said that Rs 449.38 lakh was used for general corporate purposes, while the cash-flow statement recorded Rs 41.74 crore of investment in optionally convertible debentures.

Conclusion

Sobhagya Mercantile’s segment figures show that sequential metal-sale revenue growth did not restore profitability in the half year ended September 30, 2026. The September-quarter EBITDA loss narrowed to Rs 5.05 crore, but the six-month loss reached Rs 12.71 crore as engineering generated Rs 38.21 crore of EBITDA and supported overall segment earnings.

The next reported result should show whether metal sale can sustain the quarter-on-quarter reduction in its loss while revenue changes. The company also disclosed that 6,50,500 share warrants remained outstanding and exercisable under their original terms after 6,50,500 equity shares were allotted on July 13, 2026.