HPAL - HP Adhesives
📢 Recent Corporate Announcements
HP Adhesives Limited has issued a postal ballot notice to seek shareholder approval for the appointment of Dr. Chandra Sekhar Nettem as a Non-Executive Independent Director. The proposed appointment is for a five-year term effective from February 12, 2026, to February 11, 2031. Shareholders can cast their votes through a remote e-voting process that runs from March 2, 2026, to March 31, 2026. The final results of the special resolution will be declared on or before April 2, 2026.
- Proposed appointment of Dr. Chandra Sekhar Nettem as Non-Executive Independent Director for a 5-year term.
- Remote e-voting period is scheduled from March 2, 2026 (9:00 AM) to March 31, 2026 (5:00 PM).
- The cut-off date for determining shareholder eligibility to vote was February 20, 2026.
- The appointment is subject to shareholder approval via a Special Resolution.
- Results of the postal ballot will be announced within two working days of the voting conclusion.
HP Adhesives reported a weak set of numbers for Q3 FY26, with consolidated Revenue from Operations declining slightly to ₹65.37 crore from ₹66.68 crore YoY. Profit After Tax (PAT) witnessed a sharp decline of 61.4%, falling to ₹1.62 crore compared to ₹4.21 crore in the same quarter last year. The company also disclosed a fire incident at its Khopoli plant on January 17, 2026, which damaged property and inventory; while operations have resumed, the full financial impact is still being assessed. On the management front, the company appointed Dr. Chandra Sekhar Nettem as an Independent Director following the resignation of Mr. Ajeet Anant Walavalkar.
- Revenue from operations for Q3 FY26 stood at ₹65.37 crore, down from ₹66.68 crore in Q3 FY25.
- Net Profit (PAT) plummeted 61.4% YoY to ₹1.62 crore, significantly lower than the ₹4.21 crore reported in the previous year's quarter.
- A fire incident occurred on January 17, 2026, at the Khopoli plant, causing damage to property, plant, equipment, and inventory.
- Nine-month PAT for the period ending December 2025 fell to ₹9.35 crore from ₹13.99 crore in the prior year period.
- Dr. Chandra Sekhar Nettem was appointed as an Additional Independent Director for a 5-year term starting February 12, 2026.
HP Adhesives Limited has submitted its statement of deviation for the quarter ended December 31, 2025, confirming that the funds raised via its 2021 IPO are being utilized as per the original objects. Out of the total fresh issue of ₹1,134.36 million, the company has fully utilized ₹540 million for working capital requirements. While ₹253.69 million has been spent on Capex, the company noted a delay in implementation compared to the original prospectus timeline. No actual deviation in the objects or amounts was reported by the monitoring agency, ICICI Bank.
- Total funds raised via Fresh Issue amounted to ₹1,134.36 million in December 2021
- ₹540 million allocated for working capital has been fully utilized with zero deviation
- Capex utilization stands at ₹253.69 million against an original allocation of ₹255.09 million
- Company acknowledged a delay in Capex implementation compared to the initial prospectus timeline
- Monitoring agency ICICI Bank and the Audit Committee confirmed no deviations in fund usage
HP Adhesives Limited (HPAL) reported a weak set of results for Q3 FY26, with consolidated Net Profit falling 61.4% YoY to ₹1.62 crore. While revenue remained relatively flat at ₹65.37 crore, profitability was severely impacted by higher employee benefits and other operational expenses. A significant concern for investors is a fire incident that occurred on January 17, 2026, at the company's Khopoli plant, which caused damage to property and inventory; the financial impact of this will be accounted for in the Q4 results. Additionally, the company saw a change in its board with the resignation of an independent director and the appointment of Dr. Chandra Sekhar Nettem.
- Consolidated Revenue from operations stood at ₹6,536.71 Lakhs, a slight decline from ₹6,667.63 Lakhs in the previous year's quarter.
- Net Profit (PAT) for Q3 FY26 plummeted to ₹162.22 Lakhs compared to ₹420.72 Lakhs in Q3 FY25.
- Nine-month (9M FY26) PAT decreased to ₹934.97 Lakhs from ₹1,398.89 Lakhs in the corresponding period last year.
- Reported a fire incident on January 17, 2026, at Unit-I (Khopoli), resulting in damage to assets and temporary suspension of operations.
- Exceptional items for the quarter amounted to a loss of ₹48.64 Lakhs, further impacting the bottom line.
HP Adhesives Limited (HPAL) reported a weak set of numbers for Q3 FY26, with consolidated revenue from operations declining slightly to ₹65.37 crore from ₹66.68 crore YoY. Net profit witnessed a sharp decline of 61.4%, falling to ₹1.62 crore compared to ₹4.21 crore in the same quarter last year, primarily due to higher other expenses and exceptional items. Additionally, the company disclosed a fire incident at its Raigad plant on January 17, 2026, which caused damage to assets and inventory, the financial impact of which will be reflected in Q4. On the management front, Dr. Chandra Sekhar Nettem has been appointed as an Independent Director following the resignation of Mr. Ajeet Walavalkar.
- Consolidated Revenue from operations stood at ₹65.37 crore in Q3 FY26, down from ₹66.68 crore YoY.
- Net Profit (PAT) fell significantly by 61.4% YoY to ₹1.62 crore from ₹4.21 crore.
- Reported exceptional items of ₹48.64 lakhs for the quarter and ₹80.98 lakhs for the nine-month period.
- Disclosed a fire incident at Unit-I (Raigad) on Jan 17, 2026, which led to a temporary suspension of operations.
- Dr. Chandra Sekhar Nettem appointed as Independent Director for a 5-year term effective Feb 12, 2026.
HP Adhesives Limited (HPAL) reported a weak financial performance for Q3 FY26, with consolidated Profit After Tax (PAT) declining by 61.4% YoY to ₹1.62 crore. Revenue from operations remained largely flat at ₹65.37 crore compared to ₹66.68 crore in the same quarter last year. A significant concern for investors is a fire incident disclosed post-reporting period on January 17, 2026, at the Khopoli plant, which damaged inventory and equipment. The company also announced the resignation of Independent Director Ajeet Walavalkar and the appointment of Dr. Chandra Sekhar Nettem to the board.
- Consolidated PAT for Q3 FY26 fell to ₹162.22 lakhs from ₹420.72 lakhs in Q3 FY25.
- Revenue from operations for the quarter stood at ₹6,536.71 lakhs, a marginal decline from ₹6,667.63 lakhs YoY.
- A fire incident occurred on January 17, 2026, at Plant-Unit-I in Khopoli, causing damage to property and inventory.
- Nine-month PAT for the period ending December 31, 2025, dropped to ₹934.97 lakhs from ₹1,398.89 lakhs YoY.
- Dr. Chandra Sekhar Nettem appointed as an Additional Independent Director for a 5-year term.
HP Adhesives Limited reported a weak set of numbers for Q3 FY26, with consolidated Net Profit (PAT) falling 61.4% YoY to ₹1.62 crore from ₹4.21 crore. Revenue from operations remained nearly flat at ₹65.37 crore compared to ₹66.68 crore in the same quarter last year. A significant concern for investors is a fire incident reported on January 17, 2026, at the company's Khopoli plant, which caused damage to property and inventory. Management also announced board changes, including the appointment of Dr. Chandra Sekhar Nettem as an Independent Director following the resignation of Mr. Ajeet Anant Walavalkar.
- Consolidated Revenue from operations for Q3 FY26 stood at ₹65.37 crore, a marginal decline from ₹66.68 crore YoY.
- Net Profit (PAT) witnessed a sharp decline of 61.4% YoY, dropping to ₹1.62 crore from ₹4.21 crore.
- A fire incident occurred on January 17, 2026, at Plant-Unit-I in Khopoli, resulting in property damage and temporary suspension of operations.
- Nine-month (9M FY26) PAT decreased to ₹9.35 crore compared to ₹13.99 crore in 9M FY25.
- Dr. Chandra Sekhar Nettem appointed as an Independent Director for a 5-year term effective February 12, 2026.
HP Adhesives Limited reported a weak set of numbers for Q3 FY26, with consolidated Net Profit falling 61.4% YoY to ₹162.22 Lakhs. While revenue remained nearly flat at ₹6,536.71 Lakhs, profitability was hit by higher other expenses and a decline in margins. A major fire incident occurred post-quarter on January 17, 2026, at the Khopoli plant, which damaged property and inventory; the financial impact of this will be reflected in the Q4 FY26 results. Additionally, the company saw a change in its board with the appointment of Dr. Chandra Sekhar Nettem as an Independent Director.
- Consolidated Revenue from operations stood at ₹6,536.71 Lakhs, a slight decline from ₹6,667.63 Lakhs in Q3 FY25.
- Net Profit (PAT) for the quarter fell sharply to ₹162.22 Lakhs compared to ₹420.72 Lakhs in the same quarter last year.
- 9-month PAT for FY26 decreased to ₹934.97 Lakhs from ₹1,398.89 Lakhs in 9M FY25.
- A fire incident on January 17, 2026, at the Khopoli plant caused damage to PPE and inventory, leading to a temporary suspension of operations.
- Other expenses increased significantly to ₹1,163.89 Lakhs in Q3 FY26 from ₹894.47 Lakhs YoY.
HP Adhesives Limited reported a fire incident at its manufacturing facility in Raigad, Maharashtra, on January 17, 2026. While there were no human casualties or injuries, the company is currently assessing the financial loss and the resulting impact on production capacity. Management has stated that the facility has adequate insurance coverage and is in the process of filing claims to mitigate the damage. The company is taking steps to restore normal operations at the earliest, though a specific timeline has not yet been disclosed.
- Fire occurred at the Khalapur, Raigad manufacturing unit on January 17, 2026, at approximately 7:30 P.M.
- Zero casualties or injuries to human life were reported from the incident site.
- Company confirms adequate insurance coverage is in place to cover property damage and losses.
- Full assessment of the impact on production and total quantum of loss is currently underway.
HP Adhesives Limited has submitted its quarterly compliance certificate under Regulation 74(5) of the SEBI (Depositories and Participants) Regulations, 2018. The company's Registrar and Share Transfer Agent, Bigshare Services Private Limited, confirmed that the regulation is not applicable for the period. This is because the entire shareholding of the company is already in dematerialized form. No requests for dematerialization or rematerialization were received during the quarter ended December 31, 2025.
- Compliance certificate filed for the quarter ended December 31, 2025.
- 100% of the company's shares are held in dematerialized form.
- Zero requests for dematerialization or rematerialization were received during the quarter.
- The filing is a routine regulatory requirement confirmed by Bigshare Services Private Limited.
HP Adhesives Limited (HPAL) has notified the exchanges regarding the closure of its trading window for designated persons starting January 1, 2026. This move is a standard regulatory requirement under SEBI (Prohibition of Insider Trading) Regulations, 2015, ahead of the company's financial results for the quarter and nine months ending December 31, 2025. The trading window will remain closed until 48 hours after the financial results are declared. The specific date for the board meeting to approve these results will be announced at a later date.
- Trading window for designated persons to close from January 1, 2026.
- Closure is in anticipation of financial results for the quarter and nine months ending December 31, 2025.
- The window will reopen 48 hours after the official declaration of the financial results.
- Board meeting date for result approval is yet to be announced by the company.
Financial Performance
Revenue Growth by Segment
The company operates in a single reportable segment: Adhesives & Sealants. Revenue for FY24 was INR 236.97 Cr, representing a marginal growth of 1.41% compared to INR 233.67 Cr in FY23.
Geographic Revenue Split
Domestic sales contribute approximately 88.77% of revenue, supported by a network of 1,575+ distributors. Exports account for 11.23% of total revenue (FY25), with a presence in 21+ countries including UAE, Iraq, Mexico, and Qatar.
Profitability Margins
Gross margins improved from 27.8% in FY23 to 31.7% in FY24. However, PAT margin moderated to 7.16% in FY25 from 8.68% in FY24, and further declined to 6.34% in Q1 FY26 due to increased operational costs.
EBITDA Margin
PBILDT margin was 10.93% in FY25, a decrease from 13.40% in FY24. This moderation was primarily driven by higher employee costs resulting from aggressive recruitment to support future growth. Q1 FY26 EBITDA margin stood at 9.88%.
Capital Expenditure
Property, Plant and Equipment (PPE) increased to INR 70.73 Cr in FY25 from INR 49.51 Cr in FY24. Capital Work-in-Progress (CWIP) decreased from INR 16.20 Cr to INR 4.36 Cr, indicating the completion and commissioning of expansion projects.
Credit Rating & Borrowing
CARE Ratings reaffirmed a 'CARE BBB; Stable' rating for long-term bank facilities and 'CARE A3+' for short-term facilities as of September 19, 2024. The company maintains a low-risk profile with an overall gearing of 0.02x and interest coverage of 17.15x in FY24.
Operational Drivers
Raw Materials
Key raw materials include derivatives of crude oil, which are essential for manufacturing solvent cements and synthetic rubber adhesives. These materials, along with traded goods, represent approximately 61% of total revenue based on FY23 consumption of INR 142.09 Cr.
Import Sources
Approximately 30% of raw materials and traded goods are imported to ensure quality and availability, though specific source countries are not disclosed in available documents.
Capacity Expansion
The company completed significant expansion in FY25, evidenced by the transfer of INR 11.84 Cr from CWIP to PPE. The manufacturing facility is located at Khalapur, Raigad, Maharashtra, providing proximity to the JNPT port for logistics efficiency.
Raw Material Costs
Raw material costs are highly susceptible to crude oil price volatility. The company manages this by passing on price increases to customers with a time lag. In FY23, material costs were INR 142.09 Cr against revenue of INR 232.99 Cr.
Manufacturing Efficiency
The company operates a centralized facility in Maharashtra with 7 strategically located sales depots across India to optimize distribution and service more than 1,575 distributors.
Logistics & Distribution
The company utilizes 7 sales depots to service its domestic distributor base. Proximity to JNPT port provides a strategic advantage for the 11.23% of revenue derived from exports.
Strategic Growth
Growth Strategy
Growth is targeted through the expansion of the distributor network (increased from 1,250 to 1,575+), increasing export footprint beyond 21 countries, and diversifying the product portfolio into ancillary plumbing products like ball valves and Teflon tapes.
Products & Services
Solvent cements, silicone sealants, synthetic rubber adhesives, rubber lubricants, PVA adhesives, gasket shellacs, ball valves, Teflon tapes, spray paints, and masking tapes.
Brand Portfolio
HP Adhesives (proprietary brands).
New Products/Services
The company has expanded into silicone sealants, rubber lubricants, and trading products like ball valves and masking tapes to leverage its existing plumbing and hardware distribution channels.
Market Expansion
Targeting deeper penetration in 21+ export countries including UAE, Iraq, Mexico, and Qatar, alongside domestic expansion through 7 regional sales depots.
Market Share & Ranking
The company is noted to have a modest scale of operations compared to established brands in the adhesive industry.
External Factors
Industry Trends
The adhesives and sealants industry is evolving towards a wider application range in plumbing, automobile, and furniture sectors. HPAL is positioning itself by expanding its SKU count and product categories to become a multi-product player.
Competitive Landscape
Competes with established large-scale brands in the chemical and adhesive sectors; HPAL's strategy focuses on niche plumbing applications and a wide range of SKUs.
Competitive Moat
Moat is built on proprietary brands and a robust distribution network of 1,575+ partners. Proximity to JNPT port provides a sustainable cost advantage for international trade compared to inland competitors.
Macro Economic Sensitivity
Highly sensitive to global crude oil prices and geopolitical factors that affect petrochemical supply chains and shipping costs.
Geopolitical Risks
Trade barriers or supply chain disruptions in the Middle East or other export regions (UAE, Iraq) could impact the 11.23% export revenue stream.
Regulatory & Governance
Industry Regulations
Operations are subject to the Companies Act, 2013 and SEBI Listing Regulations. The company maintains internal financial controls with no reportable deficiencies as of March 31, 2025.
Environmental Compliance
ESG risks are noted as 'Not Applicable' in credit rating assessments for this scale of operations.
Taxation Policy Impact
The effective tax rate was approximately 23.9% in FY23, with current tax liabilities of INR 1.28 Cr as of March 2024.
Legal Contingencies
No penalties or strictures were imposed by SEBI or Stock Exchanges. The company reported no instances of significant fraud or material legal violations during the audit period.
Risk Analysis
Key Uncertainties
Volatility in crude oil prices (primary input) and foreign exchange risk (30% imports) are the primary business uncertainties that could impact PBILDT margins, which already saw a decline to 10.93% in FY25.
Geographic Concentration Risk
Domestic revenue is concentrated in India (~89%), while export revenue is spread across 21 countries, reducing single-country export risk.
Third Party Dependencies
30% dependency on imported raw materials and traded goods exposes the company to global supplier and shipping availability.
Credit & Counterparty Risk
Receivables increased by INR 4.30 Cr in FY25. The company reversed a provision for expected credit loss of INR 0.55 Cr, suggesting stable credit quality of its 1,575+ distributors.