This article first appeared on GuruFocus .
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Consolidated Volumes:Flat year on year and quarter on quarter.
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Performance Surfactants:High single-digit decline in volumes.
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Mass Specialties:Double-digit volume growth driven by non-US geographies.
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H1 FY26 Consolidated Revenues:Grew 2% year on year.
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EBITDA:Declined by 5% year on year to INR 251 crores.
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EBITDA per Metric Ton:Approximately INR 18,700.
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India Volumes:Flat year on year and quarter on quarter.
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AMET Region Volumes:Modest single-digit decline quarter on quarter; high single-digit decline year on year.
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Turkey Volumes:Double-digit growth quarter on quarter and year on year.
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Rest of the World:Latin America and Asia Pacific posted double-digit year on year gains.
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North America:Decline due to reciprocal tariffs impacting demand and margins.
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EBITDA Impact from US Tariffs:Cumulative impact of 3% to 5% of FY25 EBITDA.
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Release Date: November 13, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript .
Positive Points
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Galaxy Surfactants Ltd ( NSE:GALAXYSURF ) reported a 2% year-on-year growth in consolidated revenues for H1 FY26, driven by double-digit growth in Specialty Care products.
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The company successfully mitigated some volume declines in India by gaining market share with Tier 2 and Tier 3 customers.
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Turkey showed strong performance with double-digit volume growth, partially offsetting slower recovery in Egypt and other AMET markets.
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Latin America and Asia Pacific regions maintained strong growth trajectories, posting double-digit year-on-year gains.
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Galaxy Surfactants Ltd ( NSE:GALAXYSURF ) is actively working on diversifying its supply chain by shifting some production to its Egypt plant to mitigate the impact of US tariffs.
Negative Points
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The imposition of 50% tariffs by the US on exports from India adversely impacted Galaxy Surfactants Ltd ( NSE:GALAXYSURF )'s business, affecting both existing operations and projects in the pipeline.
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Elevated fatty alcohol prices have significantly impacted the company's business, leading to reformulation by customers and a decline in performance surfactants volumes.
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The recent GST rate reduction in India led to inventory adjustments by FMCG players, resulting in softer uptake and subdued volumes for the quarter.
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The AMET region recorded a modest single-digit volume decline quarter-on-quarter and a high single-digit decline year-on-year, primarily due to intensified competition in Egypt.
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North America experienced a decline in demand and margins in the Specialty Care segment due to reciprocal tariffs, impacting overall performance.
Q & A Highlights
Q: Can you elaborate on the impact of reformulation on your performance volumes in India? Is this a structural change? A: K. Natarajan, Managing Director, explained that the reformulation is not structural. It is a response to elevated fatty alcohol prices and is expected to be temporary. The reformulation began gaining pace in August, and it impacted volumes by about 3,000 to 4,000 tons in the quarter.
Q: What is the outlook for demand recovery in India, considering the GST impact and reformulation? A: K. Natarajan noted that Q3 is expected to be similar to Q2 due to continued GST impact and an extended winter. Recovery is anticipated from Q4, with gradual improvements as inventory adjustments are completed.
Q: What is happening in the AMET region, particularly in Egypt, and how are you addressing the challenges there? A: The AMET region saw a decline due to intensified competition and high fatty alcohol prices prompting reformulation. K. Natarajan mentioned that the company is engaging with customers to mitigate headwinds and is focusing on growth in other regions like Turkey, which showed strong performance.
Q: How are you managing the impact of US tariffs, and is there a risk of permanently losing business in the US? A: K. Natarajan stated that customers are not happy with the tariffs and are eager to resume business once they are lifted. The company is working on shifting some production to Egypt and building pipelines in other regions to mitigate the impact.
Q: Can you provide an update on your strategy for the rest of the world, given the high base and potential slowdown? A: K. Natarajan emphasized that the company is focusing on hunting for new customers and increasing share with existing ones in regions like Latin America and Asia Pacific, which have shown strong growth.
Q: What is the status of your EPC contract and revenue recognition? A: Abhijit Damle, CFO, mentioned that the project is progressing well, but revenue recognition will depend on project completion milestones. It is a multi-year project, and revenue will be recognized over more than one year.
Q: How are you addressing the challenges in the Specialty Surfactants segment, particularly with tariffs and slowdowns? A: K. Natarajan indicated that the company is exploring shifting supply chains to Egypt and potentially building capacities there if tariffs persist. They are also focusing on expanding in other regions to offset the impact.
Q: What is your outlook on EBITDA spreads and volume growth for FY26? A: K. Natarajan refrained from providing specific guidance due to volatility but expressed optimism for Q4, expecting some positive tailwinds. The company is focusing on strategic adjustments to navigate current challenges.
For the complete transcript of the earnings call, please refer to the full earnings call transcript .
