Ganesh Benzoplast Limited (500153) Earnings Call Transcript
November 14, 2025
Earnings Call Speaker Segments
Ladies and gentlemen, good day, and welcome to the Ganesh Benzoplast Limited Q2 FY '26 Earnings Conference Call. [Operator Instructions] Please note that this conference is being recorded. I now hand the conference over to Mr. Rishi Pilani, Chairman and Managing Director. Thank you, and over to you, sir.
Good evening, everybody. Thank you so much for joining us for the Q2 FY '26 conference call. We will initiate the call by taking you through the business highlights for the period under review, after which we will open the forum for Q&A. Now I hand over the call to Mr. Amar Kabra, GM, Finance and Taxation, to share the quarter numbers with you.
Yes. Good evening, everybody. So on a consol basis, during the H1 of financial year '26, the company achieved a total revenue of INR 1,946 million as compared to INR 1,851 million for the corresponding period in the previous year, with an increase of 5% Y-o-Y. During H1 of financial year '26, the consolidated profit after tax is INR 419 million as against INR 329 million for the corresponding period in the previous year, with an increase of 26% Y-o-Y. On a quarterly basis, the company achieved a turnover of INR 990 million as compared to INR 976 million in the corresponding quarter in the previous year. And the profit after tax increased to INR 237 million as compared to INR 164 million in the corresponding quarter in the previous year with an increase of 44% Y-o-Y. Consolidated EPS increased to INR 3.30 in Q2 of financial '26 from INR 2.29 in Q2 of financial year '25 with an increase of 44% Y-o-Y. On a stand-alone basis, during the H1 of financial year '26, the company achieved a total revenue of INR 1,186 million as compared to INR 1,028 million for the corresponding period in the previous year with an increase of 15% Y-on-Y. During H1 of financial year '26, the stand-alone profit after tax is INR 350 million as against INR 304 million for the corresponding period in the previous year with an increase of 15% Y-o-Y. On a quarterly basis, the company achieved a turnover of INR 616 million as compared to INR 543 million in the corresponding quarter in the previous year, with an increase of 13% Y-o-Y and the profit after tax increased to INR 209 million as compared to INR 147 million in the corresponding quarter in the previous year with an increase of 42% Y-on-Y. Stand-alone EPS increased to INR 2.91 in Q2 of financial year '26 from INR 2.06 in Q2 of financial year '25 with an increase of 41% Y-o-Y. So with that, I have given the highlights for the results. Now I would like to open the forum for questions and answer.
[Operator Instructions] We take the first question from the line of [ Gautam Gupta ], an individual investor.
Congratulations for a steady set of numbers. I would start with -- by addressing the elephant in the room. In the last con call, we said that by September end, we will be announcing for what we will be using a 4-acre land, but there hasn't been any exchange filing. Can you please explain for that?
Yes, we were going through some -- we had to solve some technical issues with the closure of the JV because of which it is delayed. But now the work has already commenced in terms of engineering and everything. And in the first phase, we are already building 30,000 tonnes of A-class petroleum tanks in the land, while the balance, we are still deciding what to do.
Okay. I also want to know something about the supply side for the demand of the products. I mean the largest in the industry is coming up with 3 lakh liters metric ton plant of LST and similar for somewhat new construction for LPG. So will we be able to get orders for our plant -- new plant terminals?
See, as of now, we have not got any indication or any signal from our customers that they are planning to migrate or go away. Plus, as on date today, if you see Bombay's volumes, the Bombay region volumes are divided amongst 2 ports, which is Mumbai port and JNPT port, right? So if there is enough demand to supplement that the ships don't prefer to do 2 port callings. It's not their first choice. But as of now, on JNPT side, there is not enough tankages, right? So if there is another option that comes up, which allows the ship to discharge fully at one port, then probably we may -- what we are looking at is that we'll be cannibalizing the volumes on Bombay Port Trust, which is also significant.
Okay. Another question is that the same industry leader has been signed an MOU with the Vadhavan Port Management Trust. So the port for Phase 1, it is -- the time line is 2029, '30. So are we also in talks for the allotment of land over there? Or we are just looking for what we have in our plate right now?
See, I don't know the details of the MOU, so I can't comment on it. What I can tell you from our side is that we are always looking for any viable opportunities to expand and grow. But the term is viable.
That's it from my side. I just want to congratulate, sir, for turning around this company being a successful entrepreneur from a chemical company to...
We take the next question from the line of Saurabh Dhole from True Beacon Investment Advisors.
I have a question on the information that you laid out on Slide #14, where you're talking about the potential of your facilities at the JNPT site. So you've laid out a number of points as to how you can increase your realizations over time on these facilities. So I'm interested in knowing what -- where are we in this journey of, let's say, increasing the height of the tanks or maybe making them or converting them to cargo tanks. And when do these changes start impacting the realization numbers and the revenue numbers of the company?
So what you are seeing, that is an ongoing process. It's not a when. This is happening continuously. We are converting tanks for specialized products. We are enhancing tank capacities. We always go to improve our product mix wherever we can. So the steady state growth that you keep seeing is actually a mixture of all this. Now why none of these can result in step jumps is because you have to understand that they add incremental values. They don't add additional values. So if, let's say, you change a product mix and a tank is giving you a rent of INR 100, with the product mix change, you get a rent of, let's say, INR 110 or INR 105. But that tank capacity may be just 1% of your overall capacity. So what you see is the impact is not that significant, but why it's important to us is because it improves -- yes, it does give us incremental growth in terms of profits, but also it gives us a wider customer base, longer stickier contracts. And so we have to factor in all of those together.
No, that's obviously visible in your the LST division margins, et cetera. But what I meant to ask is that, let's say, you were to raise, or you think that the potential of raising the height of the tanks is from, let's say, 100 to 120. I wanted to know where are you exactly in that 100 to 120 journey? Are you at 103? Are you at 115?
So every year, we are doing this. Whenever we get an opportunity that a tank can remain empty for 3 to 4 months, then we take that opportunity to do this exercise. But that opportunity is very limited because obviously, the tanks are always full of cargo, and it doesn't make sense to take a tank down for 4 months, 5 months to do these exercises. So I would say that this would be an ongoing activity for all the tanks over the next 4 to 5 years. Slowly, slowly, whenever we get an opportunity, we do that. And in some tanks, we may not get the opportunity also because they are already at max height. So whichever tanks are possible, probably we realize the full potential over the next 4 to 5 years.
Okay. And just one last question. On this land that is available to you, this 4.5 hectares that you're talking about, what is the max potential of this particular land in terms of adding capacity at the JNPT?
See, max potential depends. So like I said, we have already started with 30,000 tonnes of Class A tanks. But the max capacity depends like right now, we have a lot of different product choices, including some cryogenic bullets -- sorry, pressurized bullets. There are a lot of options being discussed right now. So you -- so the exact capacity is difficult to define in terms of a land. So -- but let's say, if I just made LST, which is the normal liquid, probably we could make totally including this 30,000 close to about 1 lakh to 1,20,000 KL.
Got it. So that increases your capacity by almost 50%?
Yes, we are close to 3 lakh now, almost 40%, yes.
40%, yes.
We take the next question from the line of [ Rekha Multani ] an individual investor.
I wanted to check on your dividend policy actually. So I know last few years, even though we were profitable, we couldn't pay out because of the margin issue. Now that it's resolved, what can we expect in terms of dividend?
See, ma'am, dividend policy is something that we are also actively looking at being promoters, you can understand that we stand to benefit the most from it. But there are 2 things that we always look at is, one is that what is the company doing with the money right now. So right now, like I said, we have this expansion coming. We have -- we want to make sure that we are doing that as fast as possible. So we are looking at somehow trying to get a good mix in of dividend versus capital utilization. Probably, I think in next quarter, when I do the call, at that time, we'll be able to give you a very, very firm answer on this.
Yes. We are thinking on dividend also. But yes, we'll confirm by next quarter.
We take the next question from the line of [ Anukul ] an individual investor.
I have a few questions. Firstly, could you please update me on the LST utilization and the EPC order pipeline?
Okay. What's the second question?
The next is providing any visibility on the Chemical segment margins and volume going forward?
These 2 questions?
Yes. Firstly, these 2, then we'll proceed with my other questions.
Okay. So LST utilization has remained almost steady with what it was in last quarter. Obviously, there is some ups and downs that go on, but more or less, we are at a steady state that we are running where JNPT and Cochin are almost 100% utilized and Goa is about approximately 5% to 10% utilization. That's what it goes at. For EPC order book, as of now, we are working on projects in Mundra and the JSW project that we have. These are the 2 projects that we are working on. And for Chemical division, so Chemical division more or less works at the steady state. Yes, in June quarter due to the weather and all, there is less sale of the food products that utilize food preservatives. So there is a small variation that comes, which is normally expected. This is also seasonal. Otherwise, whatever numbers we have, we are quite hopeful that we continue to meet or beat them quarter-over-quarter.
Understood. Great. One thing I need clarification, because I missed the point on the CapEx front, what you had told on that side, if you can just repeat that out?
CapEx.
CapEx for upcoming expansion?
Yes, right. Sorry?
CapEx for what? I've not said anything about CapEx till now.
No. Like earlier, you told that you're planning for a CapEx in LST side. In the last con call, you had...
Yes, yes, yes. Okay, okay, okay. So like I already said, we have started work on 30,000 tonnes of A-Class tanks. So that CapEx has started. Our overall -- the final number for CapEx will again depend on the final tanks that we decide to build for what type of product? Is it for gas? Is it for liquid and what kind of associate ancillaries are required for that. But again, going back to my -- like if we go just by pure liquid, we would expect anywhere around INR 125 crores to INR 150 crores of CapEx if we go only for pure liquid for developing the entire plot.
Understood. And what incremental revenue are we seeing from this 30,000 tonne A-Class tanks?
Our expectation would be that only from these tanks, we should be able to get what we get for our existing tanks, which is approximately in the range of about INR 400 to INR 500 a KL per month.
Okay. Understood. And this CapEx that you are telling, will this be funded through internal accruals only?
Yes. We are, as of now, planning to fund it through internal accruals. We will -- we always, like any other company, we will make sure that we have backup bank lines available in case we require. But as of now, the company has sufficient funds to fund it.
And it will come in a staggered manner, phase by -- so obviously, it will be -- most hopefully, it will be through our internal resources.
Understood. Understood. So roughly, I can expect around INR 20 crores of incremental revenue from this?
The -- you're seeing from the A Class tanks?
Right, right.
So it's INR 30,000, yes, approximately, you can say anywhere between INR 12 crores to INR 15 crores. That would be our hope.
Understood. And lastly, I need one clarification on the lease-related items and financials one-off, whether the INR 80.08 million lease rental is a onetime charge, firstly, on that part?
And for what else?
The nature of the INR 97.26 million exceptional income, which we have included and any future lease-related charges that is expected in FY '26, '27?
Yes. So I'll answer the lease-related item is that we have gone for a renewal of our land lease with JNPT since 30 years were over. So based on the certain rules of the port and as per the Major Port Trusts Act, they have revised the lease rentals. So while we don't have the renewed letter in our hand, as a prudent practice, since we know that this might be the approximate impact, we've taken it. And this would be quarter-over-quarter. So this is going to be the revised lease rentals that will continue now. Have I answered your question? Understand? Understand?
Yes, yes, yes.
And for the INR 97.26 million, as you know that we had a JV with BW and all for LPG, which for whatever reasons, we all decided to break away from. But -- so this is a fee that has been paid by BW to us for breaking away. So this is a onetime. The fees is to the onetime.
Okay. And lastly, just one last question from my end. From the incremental revenue of INR 12 crores to INR 15-odd crores that you are seeing, how much margins on this incremental revenue can we expect?
So you can expect for this part an EBITDA of almost 90% because there is no real increment in cost, except for a little bit handling cost. Rest all is already the manpower, and everything is already in place. The lease rentals are already accounted for from before.
Understood. And any time line of this CapEx by when are you planning for doing this and...
We would expect the INR 30,000 to commission within a year.
Okay. And any further CapEx which you are planning for going forward post that?
That -- see, like I said, we are still selecting the final product mix. So as soon as we decide that, we will let you know.
We take the next question from the line of [ Ketan Chheda ] an individual investor.
I'd like to know that in the June quarter, we had a bump up in the margins of both LST division as well as the Chemical divisions. And of course, in this quarter, we've seen that those margins kind of dip. So could you explain what has caused this? Because the bump up in the margins was in both LST as well as the Chemical divisions in the June quarter?
Chemicals, obviously, it's a seasonal thing, Rishi has already explained. You can see June to June and September to September year-on-year. So there is no much variation in that figure. Obviously, June to September, there is slight down in the Chemicals segment. And in LST, you can see due to this lease rental only, you are seeing the down in the profit. But if you remove that leasing, lease expenses, then there is an upward trend only. It's -- we are in incremental profit as compared to the last quarter.
Okay. So as far as LST is concerned, then whatever margins we've got in the September quarter is a steady state normalized we can expect?
Yes, yes. Because ultimately, as explained, this lease rental is this year -- this -- this rental will be increased. Otherwise, there is profit. And in fact, it is going to increase because the past litigation cost on account of Morgan and all these things, those are going to reduce. Then obviously, there will be a lease rental -- sorry, storage rental increment. So that will cover the increased lease rent. So hopefully, we'll be in a better position in next year.
Okay. So you're saying going forward, there's a possibility that our margins should improve going forward?
Yes, yes, yes. At least it will cover up that extra lease rental, which has been hit from this year.
Okay. Okay. Sure. And for the other development that we are thinking of the available land at the JNPT, so -- by when do we expect to kind of finalize the plans? Because now I think what you are doing is you kind of started development on a part of the plant, which is the 30,000 tonne petroleum tank, Rishi, that you mentioned. So then we will have some balance, right? So by when do we think of finalizing the plans on that one?
See, the thing is that we want to find the most optimum solution. So we are talking to a lot of stakeholders for different type of tanks. And we don't want to rush into answer until we've evaluated every option thoroughly in terms of what is the most -- what gives the most ROI to the company. So while it's very difficult to define a time line that this should happen within 5 days or 10 days or 1 month. Obviously, our hope is that we should do this ASAP and -- but I don't have a firm time line for this.
No, Rishi, I really appreciate if you're taking as much time you want but we don't want to kind of repeat what happened last time that we entered into some kind of a business proposal and then we get called off. I really appreciate you trying to kind of do the maximum diligence and making sure that we don't encounter this something again. So fair enough. The other question...
As it is we started the development. So it's not that it's on hold. It's just that -- see, because land is a very precious commodity. And once you start down a certain path, then it's very difficult to reverse and make something else what you've already made. So we want to make sure that we have the best ROI possible before we start committing to making anything firm.
No, I again appreciate as I said like your prudence is totally appreciated. No more questions on that front. The other question I had was on the Chemicals business, any thoughts you had in the last quarter about what you want to do? I know in the last con call, you mentioned that you would kind of want to stabilize the Chemicals business in this year. But while we are stabilizing the Chemicals business, have we had any discussions with some potential parties or some internal thoughts what we want to do?
No. As of now, we've not had any further discussions with anybody.
We take the next question from the line of Bharat Gupta from Fair Value Capital.
A couple of questions, sir. First, in regard -- like you mentioned in one of your previous con calls that you will be taking a rental increase of near about 4% to 5-odd percent. So that thing we have been able to pass it on to the customers or we are still in discussions with them?
No, that is generally year-over-year when our contracts are getting renewed, we aim to get at least a 4% to 5% increase in our rentals.
Maybe for some customers, it's on a yearly basis. You will get the fixed yearly 4% to 5%. For some customers, it's a onetime like after 3 years, we are going to renew the contract. So lump sum, we are charging 15%, 17% to the customer, like that. So it's an ongoing process.
Right. So for this year, if we take it on a pricing front, so will there be some sort of a translation coming in place or that will be coming in largely next year itself?
Can you please repeat? I didn't understand the question, sorry.
I was just asking like for this financial year, will there be some sort of an increase, which will be taken in place? Or mainly it has been renewed prior to the March and probably the increase will see probably on the next year financial numbers.
So it's an ongoing thing. The customer contracts keep getting expired regularly because it may happen in October, it may happen in December, Jan, Feb. So whenever that happens, that's when it -- we start negotiating for the next rate.
Right. And sir, secondly, with respect to the -- like 3 acres, you have already mentioned that you will be utilizing it for Class A. But with respect to the rest 8 acres, which are there. So like we are still in discussions with respect to finalizing the product mix. But are we exploring any opportunity with respect to LPG or ammonia?
Of course. So let me first clarify, 3 acres with respect to A-Class is already commissioned and it's operational since more than a year. We are building an additional A-Class capacity of 30,000 tonnes. And yes, definitely, we are looking at opportunities of LPG and ammonia.
Right, sir. But we won't be looking out for with respect to cryogenic.
No, why not?
Right. So going forward, like if we have to look out at the company for the next 3 years vision point of view, so what kind of a CapEx should we build in? Will it be somewhere close to INR 400 crores, INR 500-odd crores or taking in INR 100 crores, INR 150 crores annual run rate?
See, like I said, that this number depends heavily on the type of tank we are going to build. So if I decide to build only pure LST, it's about INR 150 crores or so. If we go for cryogenics or bullets, yes, you're right, the number may go up to INR 400 crores, INR 500 crores.
Or ammonia...
So with ammonia, it may be a mix of close to INR 300 crores to INR 400 crores. So once we know that for sure, but obviously, the decision will be based on the fact that whatever incremental CapEx is done, the ROI should be justified for the incremental CapEx. So the decisions will definitely be made like that.
We take the next question from the line of Udit Gupta, an individual investor.
Sir, the lease rentals that have been revised, sir, what were they earlier and what have they become? And sir, for FY '26, does that reduce our profitability? Or is this going to get compensated by increased revenues?
So the lease rentals before were approximately close to about INR 3 crores or so per year, which is now revised to approximately -- we don't know the exact number yet, but it will be somewhere around INR 18 crores to INR 20 crores a year.
And sir, does that reduce our profitability for FY '26 because this is a sudden increase in cost?
So lease is definitely a cost -- straight cost to your P&L. But having said that, we are increasing our prices a little bit to sort of compensate for this. And we are also -- since our new capacities, we have already started working on, once they come in. So overall, we expect that within the next 2 to 3 years, we should be able to cross this any impact. It will definitely keep reducing and whatever impact this has, we'll be able to overcome it.
Right. Sir, on your balance sheet, sir, there are some short-term loans and some long-term loans that we have given out of approximately INR 70 crores and INR 20 crores or something. Sir, could you elaborate a little bit on that?
Yes. So these loans advances pertain to loans advanced to our wholly owned subsidiaries like GBL LPG, GBL Infra, who are in the EPC...
No, sir I'm talking about the consolidated numbers. So your subsidiaries will not show there.
Yes. So on consolidated basis...
In the consolidated numbers, the long-term loans are INR 70 crores, and the short-term loans are about INR 27 crores.
Yes, yes. So there is a mix of loans and advances because there is some fund -- idle fund line with the banks, which we have kept in FDs and all these things. So to get the better returns, which will at least beat our inflation, we have given some ICDs, which are earning more than our bank FD rates. So that might be the...
So approximately, what kind of interest are we earning?
We are earning average around 10% to 11% as against 6.5% in the bank FDs.
Okay. Got your rationale. And sir, there is another disclosure that Aegis is building a new terminal in JNPT of approximately INR 500 crores. So does that impact us in terms of competition?
I think I already answered that question in my first answer. And...
I might have missed it.
Yes. So basically, see, there are 2 things that -- and right now, the entire cargo in the Mumbai region is basically divided between 2 ports, that is Mumbai Port and JNPT Port. Now no shipper likes to call 2 ports. So what we are sort of foreseeing is that if there is enough demand at JNPT and tankages -- if there is enough, sorry, tankages available in JNPT to offload the entire ship load, then we'll actually be cannibalizing the cargo from Mumbai Port to JNPT.
Sir, that means that it could be beneficial for us if these capacities come in, that some people will want to move from Bombay to JNPT?
Yes, because no point in calling both the ports, right? The ship charges you extra.
Right. Sir, but you don't see a problem of competition increasing at JNPT and our prices going down or something of the sort?
See, in prudence, nobody should be reducing prices because it doesn't benefit anybody. Like our terminals are -- like my terminal started first phase was in somewhere around '95, '96. So for us, the pricing is different for anybody building new terminal today. For them, the pricing is significantly different. So nobody would like to kill their ROI by just reducing prices, right? Nobody gave...
And so then lease rental costs would also be relatively higher because it's a new terminal...
Sorry to interrupt, Mr. Udit.
The same as ours. In terms of per square meter rate, it's same.
We take the next question from the line of [ Rohan ], an individual investor.
I hope I'm audible.
Yes, [ Rohan ].
Sir, I just want a clarity regarding one part, if I missed. So for the additional 30,000 tonnes A-Class tanks, you just -- I want confirmation, like you said we are going to earn INR 400 to INR 500 per kilo per month -- per KL.
That is the expectation, yes.
Yes. That's right. Okay. And can I know like what's the CapEx we have -- like how much we are going to spend for this 30,000 tonnes capacity?
Yes, it is going to be approximately INR 40 crores.
INR 40 crores. Okay. And can we know like what kind of EBITDA margin is going to earn on this?
What we are going to earn?
EBITDA margin.
EBITDA -- I already explained that you can expect close to about 90% EBITDA on this.
Okay. And sir, what are we doing -- another question is regarding our Goa utilization, which is at less than 5%. So like what's your plan regarding of increasing this capacity utilization? And what are the triggers that can help us increase that utilization?
See the biggest trigger that can help if the government allows mining again in Goa, of course. But apart from that, we are working to see if we can do some modifications in the tank so that they can handle some other products so that we can use it for that. But as of now, that's only under -- it's under a very preliminary stage of understanding. So as of now, for the next 6 months, I would say that we could continue to expect the same type of occupancy at least.
[Operator Instructions] We take the next question from the line of [ Anukul ], an individual investor.
I had certain follow-up questions. Like as you've told that the lease rental are now revised to INR 18 crores to INR 20 crores per year. So in our other expenses, which have gone up substantially. So I think you -- INR 8 crores is for incremental lease expense. So going forward, how will be the other expenses? So if we take INR 18 crores to INR 20 crores per year, so I think it should go down, right?
Initially up to last year, we are recognizing INR 3 crores as a lease expenditure. Against that, now we are expecting it will be around INR 18 crores to INR 20 crores in total. So that additional we are showing under other expenses. And this is for 6 months up to from April to September, we have booked in this quarter. And now from October onwards till March, another INR 8 crores will come. So -- and that is going to continue as a regular lease rental.
Okay. So I think your EBITDA margin, which used to stay around 30% have now slipped to around 22%. So what will be the normalized EBITDA margin going forward then?
For rental business, it -- right now, it's around 55% -- between 50% to 55%. With the slight increase in this lease rental, it may go down for some time. But obviously, with the increase in lease rental and reduction of other overheads, like litigation costs and other upcoming capacity, new capacity, so that will remain steady, around 50% to 55%, I think that will continue to achieve on EBITDA level as far as rental income is concerned.
See, this is a onetime thing. Now this lease rent go -- remains same, increasing only by 2% per year for the next 30 years. So what happens is there is a brief period where you catch up to it in terms of maybe 1 year, 2-year brief period where you catch up to it and then it remains steady for the next 28, 29 years.
Understood. So on a consolidated basis, any EBITDA margin guidance you are giving taken into consideration these lease expenses, which are now normalized on this run rate?
Pardon?
Any EBITDA margin guidance you are giving for the entire year?
It will remain on the same line like September quarter results we have given. So obviously, you assume that similar figure will come in the next 6 months because ultimately, that onetime compensation income will go away next quarter. And this lease expenditure already have captured. So it will be in line with the trend only. Obviously, some up and down may but...
Thank you. As there are no further questions from the participants, I would now like to hand the conference over to Mr. Rishi Pilani for their closing comments. Over to you, sir.
Thank you. Again, thank you, everybody, for joining the call. I appreciate the support and the steady advice that I keep getting on these. In case of any other questions, please feel free to reach out to us. Have a good evening. Thank you.
Thank you, all.
Thank you. On behalf of Ganesh Benzoplast Limited, that concludes this conference. Thank you for joining us, and you may now disconnect your lines.
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