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Vardhman Acrylics Ltd

| Quarterly Financial Results Q3 FY 2025-26

BULLISH SENTIMENT

Report Source

⬤20th Jan 26

Summary : Vardhman Acrylics reported strong profit growth for Q3 and 9M FY26, driven by operational performance, despite new labor code impacts.

Quarterly Report Analysis & Insights

Financial Disclosures

  1. Cost of Materials Consumed: ₹53.69 Cr (Q3 FY26), ₹167.80 Cr (9M FY26).
  2. Employee Benefits Expenses: ₹6.55 Cr (Q3 FY26), ₹17.10 Cr (9M FY26).
  3. Total Expenses: ₹70.03 Cr (Q3 FY26), ₹230.77 Cr (9M FY26).
  4. Revenue From Operations: ₹76.28 Cr (Q3 FY26), ₹235.07 Cr (9M FY26).
  5. Other Income: ₹3.39 Cr (Q3 FY26), ₹10.88 Cr (9M FY26).
  6. Total Income from operations: ₹79.67 Cr (Q3 FY26), ₹245.95 Cr (9M FY26).
  7. Paid-up Equity Capital: ₹80.36 Cr.
  8. Other Equity (as of March 31, 2025): ₹158.29 Cr.
  9. The company has no subsidiary, joint venture, or associate company, implying standalone results.

Corporate Overview

  1. Implementation of new Labour Codes resulted in increased employee benefit expenses by ₹1.21 Crores.
  2. The Company operates solely in the Acrylic Fibre segment.
  3. Formal and compliant with regulatory disclosure requirements.
  4. Acrylic Fibre

Risk Factors

  1. New labor codes increase expenses.
  2. Material cost fluctuations impact profitability.
  3. Revenue declined quarter-on-quarter.

Key Drivers

  1. Significant quarterly net profit growth.
  2. Nine-month revenue and profit increased.
  3. Auditors issued an unmodified conclusion.

Auditor’s Report

  1. Unmodified conclusion on the unaudited financial results.
  2. No material misstatement found in the financial statements.

Board Commentary

  1. Increased provision for gratuity and long-term compensated absences due to new Labour Codes.
  2. Government of India notified new Labour Codes (Code on Wages, Industrial Relations Code, Social Security Code, Occupational Safety, Health and Working Conditions Code) impacting employee benefits.

Corporate Governance

  1. Audit Committee reviewed and approved the financial results.

Management Discussion & Analysis

Future Strategy

  1. Monitoring developments on new Labour Code rules and assessing accounting implications.

Operational Focus Areas

  1. Ensuring compliance with evolving regulatory frameworks, particularly new Labour Codes.

Performance Drivers

  1. Revenue from operations increased for the nine months ended December 2025.
  2. Profit before tax significantly increased for the quarter and nine months.

Risk Control Measures

  1. Continuously monitoring regulatory developments and assessing accounting implications.

Critical Risks

  1. Regulatory changes, specifically new Labour Codes, impacting employee benefit costs.