Vardhman Special Steels’ Revenue Jumps 38.81% and Profit Rises 51.88% in Second Quarter
Key Facts
Vardhman Special Steels announced on October 27 its results for the second quarter of fiscal 2026-2027, ended September 30, with revenue from operations rising 38.81% year on year to 60,005.06 lakh rupees. Net profit was 5,249.38 lakh rupees, up 51.88% from the year-earlier period. The figures reflect concurrent growth in revenue and profit during the quarter. Basic earnings per share also rose to 5.43 rupees, from 3.61 rupees a year earlier. The company released results for the quarter and first half of fiscal 2026-2027.
The chief financial officer said total sales rose 27% year on year, while revenue from operations increased 39% and earnings before interest, taxes, depreciation and amortization grew about 50%. The company’s results showed the measure at 83.86 crore rupees, compared with 56.48 crore rupees a year earlier, an increase of 48.48%. This puts operating profit growth ahead of total sales growth during the quarter. Basic earnings per share rose 50.42% year on year, according to the results. These comparisons are for the second quarter of the current fiscal year against the corresponding quarter of the previous fiscal year.
Management attributed the improvement in profitability to strong demand and operating efficiencies beginning to emerge from capital investments, including the Kocks Block and reheating furnace. It said cost savings linked to these investments started to materialize in the second quarter. On demand, the chairman said the automotive sector benefited from a cut in GST on two-wheelers and smaller vehicles, alongside good sales performance for SUVs. Management also said supply bottlenecks contributed to a demand-supply imbalance and price increases. The company linked strong demand, improved operations and pricing developments as factors that supported the period’s results.
But management cautioned against treating the quarter’s elevated profit per tonne as a sustainable level or fixed benchmark. It said it continued to expect earnings before interest, taxes, depreciation and amortization of between 9,000 and 12,000 rupees per tonne. Company officials described the reported level as being at the upper end of their guidance range. This caution accompanies quarterly profit growth and places the quarter’s performance in the context of the range management set for the coming period. The company did not provide a separate figure in this guidance that would change that range.
Management said the quarter ended September is usually the strongest because of inventory build-up ahead of the festive season, and therefore it does not expect the same sales volume to continue. At the same time, the company kept its sales forecast for fiscal 2026-2027 at about 260,000 tonnes, the level in the original budget. This guidance distinguishes the quarter’s seasonal strength from the full-year sales outlook. The chairman said demand benefited from a cut in GST on smaller vehicles and two-wheelers, with good sales performance for SUVs. The full-year estimate is therefore based on the sales volume the company is targeting despite its warning that the second quarter’s strength may not be repeated.
On expansion, the company said it had applied to increase capacity covered by environmental clearance from 300,000 tonnes to 360,000 tonnes, but had not received the final approval letter. The new plant plan targets completing the project by September 2029 and reaching stable operations by March 2030. Management said the environmental clearance application for the project is expected to be submitted in December 2026. These timelines place environmental approvals among the next steps in the expansion plan, while the requested capacity remains subject to approval. The company did not specify a new date for the final letter approving the increase in existing capacity.