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DCM Shriram Ltd

| Quarterly Financial Results Q3 FY 2025–26

BULLISH SENTIMENT

Report Source

⬤20th Jan 26

Summary : DCM Shriram reports strong Q3 and 9M 2025 results, declares interim dividend, maintains healthy ratios.

Quarterly Report Analysis & Insights

Financial Disclosures

  1. Major expenses include cost of materials consumed, purchases of stock-in-trade, employee benefits, finance costs, depreciation, power and fuel, and other expenses.
  2. Exceptional item of Rs. 55 crores for statutory impact of New Labour Codes.
  3. Revenue from operations includes sales of products and other operating revenue.
  4. Segment-wise revenue provided for Chemicals & Vinyl, Sugar & Ethanol, Fenesta Building Systems, Shriram Farm Solutions, Fertiliser, Bioseed, and Others.
  5. Net worth (consolidated) Rs. 7,330.76 crores as of Dec 31, 2025.
  6. Debt equity ratio (consolidated) 0.15 as of Dec 31, 2025.
  7. Current ratio (consolidated) 1.48 as of Dec 31, 2025.
  8. Total debt to total assets (consolidated) 0.14 as of Dec 31, 2025.
  9. Both standalone and consolidated unaudited financial results are presented.

Corporate Overview

  1. Estimated financial implications from new Labour Codes.
  2. Seasonal nature of some business segments impacting results.
  3. Diversified conglomerate with interests in Fertilisers, Chemicals, Sugar, Bioseed, Building Systems, and Cement.
  4. Formal and compliant, reporting financial results and dividend declaration.
  5. Chemicals and Vinyl
  6. Sugar and Ethanol
  7. Fenesta Building Systems
  8. Shriram Farm Solutions
  9. Fertiliser
  10. Bioseed
  11. Others

Risk Factors

  1. Uncertainty from new Labour Codes.
  2. Seasonal impact on business segments.
  3. Reliance on other auditors' reports.
  4. Potential future regulatory changes.

Key Drivers

  1. Strong profit growth and higher EPS.
  2. Interim dividend declared to shareholders.
  3. Improved operating margins across segments.
  4. Healthy debt-equity ratio maintained.

Auditor’s Report

  1. Unmodified conclusion on limited review of interim financial results.

Board Commentary

  1. Declared 2nd interim dividend of Rs. 3.60 per equity share (180%).
  2. Total interim dividend for FY25-26 aggregates to Rs. 7.20 per share.
  3. Financial implications from new Labour Codes presented as exceptional item.
  4. Seasonal nature of some business segments impacting quarterly results.
  5. Government of India notified four new Labour Codes.
  6. Company made provision for estimated financial implications.

Corporate Governance

  1. Audit Committee reviewed the financial results.

Management Discussion & Analysis

Operational Focus Areas

  1. Monitoring finalization of central/state rules for new Labour Codes.

Performance Drivers

  1. Strong revenue growth in quarter and nine months.
  2. Improved profitability across standalone and consolidated results.
  3. Declaration of interim dividend reflects healthy performance.

Risk Control Measures

  1. Company continues to monitor Labour Code developments for accounting effect.

Critical Risks

  1. Financial implications due to new Labour Codes.
  2. Seasonal nature of certain business segments.