Synopsis:
A Tata Group stock came under pressure after profits halved in Q2FY26 despite modest revenue growth, as weak soda ash prices and subdued demand hit margins.
A Tata Group stock came under selling pressure after reporting a steep sequential decline in profit for the September 2025 quarter. While revenue showed modest growth, weak realisations, lower operating margins, and subdued demand weighed on earnings and investor sentiment.
Tata Chemicals Limited, a Tata Group company, opened at Rs. 867.50 after a previous close of Rs. 890.75. The stock touched an intraday low of Rs. 858.30, marking a decline of 3.64 percent. The company’s market capitalisation stood at Rs. 22,301.36 crore.
Financial Snapshot – Q2FY26
Quarter-on-Quarter (QoQ): Revenue from operations rose 4.2 percent sequentially to Rs. 3,877 crore from Rs. 3,719 crore in the previous quarter. Operating profit declined 17.2 percent to Rs. 537 crore from Rs. 649 crore, as operating margin contracted to 14 percent from 17 percent. Profit before tax dropped 34.4 percent to Rs. 236 crore from Rs. 360 crore, while net profit declined 51.3 percent to Rs. 154 crore from Rs. 316 crore. Earnings per share stood at Rs. 3.02, compared with Rs. 9.89 in the previous quarter.
Year-on-Year (YoY): Revenue fell 3.0 percent year-on-year to Rs. 3,877 crore from Rs. 3,999 crore due to reconfiguration of UK operations and subdued market conditions. Operating profit decreased 13.1 percent to Rs. 537 crore from Rs. 618 crore, mainly on account of lower volume and realisation, partly offset by better cost management. Operating margin contracted to 14 percent from 15 percent. Profit before tax fell 32.2 percent to Rs. 236 crore from Rs. 348 crore, while net profit declined 42.3 percent to Rs. 154 crore from Rs. 267 crore. Earnings per share stood at Rs. 3.02, compared with Rs. 7.61 in the corresponding quarter last year.
As of September 30, 2025, the company’s net debt stood at Rs. 5,583 crore (excluding lease liabilities of Rs. 776 crore).
Comments from Management
Commenting on the results, R. Mukundan, Managing Director & CEO, Tata Chemicals Limited, said, “Soda ash markets continue to be over supplied, with high inventory levels in most regions. Prices continued to weaken during Q2FY26. As demand – supply remains balances continues to be soft, we expect market to continue to remain range-bound in medium term.
Despite market headwinds caused by subdued pricing, company’s performance in standalone has been positive driven by higher volumes, overall performance is resilient driven by disciplined cost management. Reconfiguration of UK is complete with focus on value added non-cyclical products.”
Operational Highlights
The company’s total sales volume (soda ash, bicarbonate, and salt) stood at 1,355 kilotonnes during the quarter, compared with 1,264 kilotonnes in the previous quarter and 1,317 kilotonnes in the same period last year, after removing Lostock (UK) volumes. Global soda ash markets remained oversupplied with elevated inventory levels across regions. Prices continued to remain weak and, in certain markets, approached record lows. While near-term global demand is expected to stay flat, medium-to-long-term prospects remain positive, supported by sustainability-linked applications such as solar photovoltaic and electric vehicle industries.
The company added that lower revenue compared with the previous year was primarily driven by pricing pressure in all regions. Tata Chemicals also holds a 55.04 percent stake in its crop protection subsidiary, Rallis India Limited.
About the Company
Tata Chemicals Limited is a leading supplier to the glass, detergent, industrial, and chemical sectors. The company operates with an integrated business model across basic chemistry and specialty products, supported by world-class R&D facilities in Pune and Bangalore. Through its subsidiary, Rallis India Limited, Tata Chemicals also holds a strong position in the crop protection and agri-input business.
Written by Manan Gangwar
Disclaimer
The views and investment tips expressed by investment experts/broking houses/rating agencies on tradebrains.in are their own, and not that of the website or its management. Investing in equities poses a risk of financial losses. Investors must therefore exercise due caution while investing or trading in stocks. Trade Brains Technologies Private Limited or the author are not liable for any losses caused as a result of the decision based on this article. Please consult your investment advisor before investing.
