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GRP Ltd Q3 FY26: PAT Drops 49% to ₹2.3 Cr Amid US Tariff Pressures & Higher Costs
GRP Limited reported a marginal 2% YoY growth in Q3 FY26 total income to ₹135.2 crore, but adjusted PAT fell sharply by 49% to ₹2.3 crore due to high raw material costs and US tariff impacts. The company faced a 40% decline in export volumes to North America as tariffs hit competitiveness, though a recent reduction in US tariffs from 50% to 18% offers a positive outlook for future quarters. Management has prudently deferred the expansion of tyre pyrolysis and recovered carbon black facilities to August 2026 to ensure operational stability. Despite global headwinds, domestic reclaim rubber revenue grew 27% in Q3, helping offset some export weakness.
Key Highlights
Q3 FY26 Adjusted PAT declined 49% YoY to ₹2.3 crore, while total income grew marginally by 2% to ₹135.2 crore.
Export volumes to North America fell 40% YoY due to high tariffs, though recent reduction to 18% is expected to aid recovery from Q4.
Deferred commissioning of Tyre Pyrolysis and Recovered Carbon Black expansion to August 2026 for technical optimization.
Domestic reclaim rubber revenue saw strong growth of 27% YoY in Q3 FY26, increasing market share by 200 bps.
Invested ₹3 crore in a solar PPA expected to generate annual cost savings of ₹3-4 crore starting soon.
💼 Action for Investors
Investors should monitor the recovery in export margins following the US tariff reduction and the stabilization of the new pyrolysis business. The stock may remain under pressure until the deferred expansion projects begin contributing to the bottom line in H2 FY27.
GRP Ltd Q3 FY26 PAT Drops 49% YoY to ₹23 Mn Amid Margin Pressure and Export Headwinds
GRP Limited reported a flat topline for Q3 FY26 with total income at ₹1,352 Mn, but faced significant bottom-line pressure as PAT (excluding exceptional items) fell 49% YoY to ₹23 Mn. The decline was primarily driven by a 383 bps contraction in gross margins due to 11% higher raw material costs and lower export volumes linked to US tariffs. While domestic reclaim rubber revenue grew 14%, the non-reclaim segment struggled with pricing pressures and sub-optimal utilization of new plants. The company is currently executing a ₹250 Cr capex plan, focusing on crumb rubber and pyrolysis to diversify its portfolio.
Key Highlights
Total Income for Q3 FY26 stood at ₹1,352 Mn, a marginal 2% increase YoY, while 9M FY26 income remained flat at ₹3,930 Mn.
EBITDA margins contracted by 153 bps to 8.3% due to rising input costs and a 45% decline in export margins for certain products.
Domestic Reclaim Rubber revenue grew 14% YoY, partially offsetting a 9% decline in export revenues caused by geopolitical uncertainties and tariffs.
The company has incurred ₹76 Cr out of a planned ₹250 Cr capex for integrated facilities to manufacture Crumb rubber and Tyre Pyrolysis Oil.
A one-time exceptional expense of ₹14 Mn was recorded during the quarter on account of the New Labour Code implementation.
💼 Action for Investors
Investors should closely monitor the ramp-up of the new pyrolysis and crumb rubber facilities, as their current sub-optimal utilization is dragging down overall profitability. The recent reduction in US tariffs to 18% and expected solar energy savings of ₹3-4 Cr per annum from Q2 FY27 are potential catalysts for margin recovery.
GRP Ltd Q3 Net Profit Drops 59% YoY to ₹2.36 Cr; Board Cancels Proposed QIP
GRP Limited reported a significant decline in profitability for the quarter ended December 31, 2025, with standalone net profit falling to ₹2.36 crore from ₹5.82 crore in the same period last year. While revenue from operations saw a modest YoY growth of 3.6% to ₹133.31 crore, margins were heavily pressured by rising finance costs and a one-time exceptional charge of ₹1.40 crore related to new labour code provisions. Furthermore, the company has officially scrapped its proposed Qualified Institutional Placement (QIP) as the 365-day regulatory timeline for implementation has expired. The core Reclaim Rubber segment continues to drive the bulk of the revenue but faces margin compression.
Key Highlights
Standalone Revenue from Operations grew 3.6% YoY to ₹133.31 crore in Q3 FY26.
Net Profit plummeted 59.5% YoY to ₹2.36 crore compared to ₹5.82 crore in Q3 FY25.
Recorded an exceptional item of ₹1.40 crore as a one-time provision for employee benefits due to new Labour Codes.
Finance costs rose significantly to ₹3.69 crore from ₹2.66 crore in the year-ago quarter.
Board confirmed non-implementation of the proposed QIP due to the expiration of the 365-day validity period.
💼 Action for Investors
Investors should exercise caution as the sharp decline in bottom-line performance and rising interest costs indicate significant margin pressure. The cancellation of the QIP may suggest either a change in capital expenditure plans or a failure to attract institutional interest at desired valuations.
GRP Limited Acquires 26% Stake in BECIS Solar 5 for Solar Power Procurement
GRP Limited has completed the first tranche of its investment in BECIS Solar 5 Private Limited to facilitate solar power procurement. The company was allotted 3,51,351 equity shares at a face value of Rs. 1 each with a nominal premium. This acquisition results in GRP Limited holding a 26% stake in the issued and paid-up share capital of BECIS. The total investment for this tranche amounts to Rs. 3,54,865, marking a strategic move towards green energy consumption.
Key Highlights
Acquired 26% stake in BECIS Solar 5 Private Limited for solar power procurement.
Allotted 3,51,351 fully paid-up equity shares at a total consideration of Rs. 3,54,865.
Shares were issued at a face value of Rs. 1 with a premium of Rs. 0.01 per share.
The transaction represents the completion of the first tranche of the investment plan.
💼 Action for Investors
Investors should view this as a positive step toward ESG compliance and long-term energy cost reduction, though the immediate financial outlay is small. Monitor for further tranches and the resulting impact on operational power costs.
GRP Ltd Invests ₹5 Crore in Subsidiary GRP Circular Solutions to Fuel Growth
GRP Limited has infused ₹5 crore into its wholly-owned subsidiary, GRP Circular Solutions Limited (GCSL), through a rights issue of 50 lakh equity shares. GCSL, which operates in the recycled and compounded polypropylene sector, has shown explosive growth with turnover rising from ₹0.77 crore in FY24 to ₹19.75 crore in FY25. This capital infusion is intended to strengthen the subsidiary's financial position and support its expansion within the plastics recycling ecosystem. The parent company maintains its 100% stake in the subsidiary following this transaction.
Key Highlights
Subscription of 50,00,000 equity shares at ₹10 each, totaling ₹5 crore in cash.
Subsidiary turnover grew significantly from ₹0.77 crore in FY24 to ₹19.75 crore in FY25.
Investment aimed at meeting fund requirements and empowering future growth in the recycling ecosystem.
GRP Limited maintains 100% ownership of GCSL post-allotment.
GCSL was incorporated in August 2022 and has scaled operations rapidly within three years.
💼 Action for Investors
Investors should monitor the scaling of GCSL as it becomes a more meaningful contributor to GRP's consolidated revenue. The rapid growth in the recycling segment aligns with global sustainability trends and could drive long-term value.
GRP Limited Credit Rating Downgraded by CRISIL
CRISIL has downgraded the credit rating for GRP Limited's bank facilities. The downgrade is attributed to the weakening of the company's business and financial risk profile due to trade tariffs impacting operating performance. The long-term rating has been downgraded to 'Crisil BBB+/Stable' from 'Crisil A-/Stable'. The short-term rating has also been downgraded to 'Crisil A2' from 'Crisil A2+'. The total bank loan facilities rated are ₹152.62 Crore.
Key Highlights
Long-Term Rating downgraded to Crisil BBB+/Stable from Crisil A-/Stable
Short-Term Rating downgraded to Crisil A2 from Crisil A2+
Total Bank Loan Facilities Rated: ₹152.62 Crore
Downgrade due to weakening business and financial risk profile
💼 Action for Investors
Investors should closely monitor GRP Limited's operating performance and its ability to manage the impact of trade tariffs. Review your investment strategy considering the increased risk profile reflected in the credit rating downgrade.