Clean Science and Technology Limited (NSE: CLEAN) Q3 2026 Earnings Call dated Jan. 31, 2026
Corporate Participants:
Siddharth Sikchi — Promoter, Executive Director
Analysts:
Unidentified Participant
Jason Soans — Analyst
Sanjay Jain — Analyst
Abhijit Akella — Analyst
Ankur Periwal — Analyst
Archit Joshi — Analyst
Presentation:
operator
Ladies and Gentlemen, good day and welcome to the Q3FY26 earnings conference call of Clean Science and Technology Limited. We have with us on call Mr. Siddharth Sikchi, Executive Director and Promoter, Mr. Sanjay Parkar, CFO and Mr. Pratik Vora, President Commercial. As a reminder, all participants line will be in the listen only mode and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during the conference call, please signal an operator by pressing Star then zero on your touch tone phone. Please note that this conference is being recorded.
I now hand the conference over to Mr. Siddharth Sikchi for opening remarks. Thank you and over to you sir.
Siddharth Sikchi — Promoter, Executive Director
Thank you so much. Good evening everyone. We thank you all for joining our con call on a Saturday afternoon. I am happy to connect with you all to discuss the business performance of the company for Q3FY26. Let me first start speaking about the business environment. There have been challenging conditions which we witnessed in quarter two have continued during this quarter as well. The current quarter was marked by challenging and uncertain business environment driven by muted customer offtake, pricing pressure and tariff related uncertainties along with incremental capacities of some of the products. Especially in China. We remain focused on customer engagement, long term growth and operational discipline while maintaining the market share amid these evolving market conditions.
On positive note, the HALS business delivered robust YoY growth of 55% driven by a favorable product mix and higher contribution from cost efficient higher derivatized hal’s polymers. With the commercialization of our new hydroquinone and catechol plant, we expect immediate margin benefit across the downstream products such as TBHQ and Veritrol. Let me speak on the standalone business performance on QOQ basis. On QOQ basis the revenue moderated to 180 crores largely due to lower sales in certain established products. The EBITDA and PAT margins are at 40% and 29% translating into an EBITDA of 72 crores and a PAT of 52 crores.
The Q on Q decline in revenue was primarily led by softer volumes in some of our selected products which also led to temporary reduction in the contribution of our top four products. Consequently, top four products contribution to stand alone revenue declined to 75% as against 80% in the last quarter. Coming to the YOY comparison, on YOY the sales declined by 21% during the quarter. This revenue decline was primarily led by decrease in sales volume. The profitability margins impacted on account of change in product mix on 9 month yoy basis the revenue declined by 10% that is from 668 crores to 602 crores.
The reduction in revenue was attributed to a loss of a key customer in one of our products in cosmetics section. Also pricing pressure and lower offtake in AGCAM segment. We believe we are well positioned to protect market share and drive sustainable growth over the long term. On consolidated business performance on sequential basis, revenue moderated by 10% to 216 crores and the Conso, EBITDA and PAT margins are at 33 and 21% respectively which stood at 72 crores and 46 crores in the sales profile. The segment wise the Performance Chemical has been the largest with 72%, pharma agro at 21% and FMCG was 5%.
The performance segment was most impacted with volume led decline in sales across me, HQ and bha. However, please note we have not seen any domestic competition in these products. The FMCG segment witnessed volume decline in a product called AS4 MAP. Key business developments in the HALS business, volume showed steady improvement during the quarter driven by better demand traction and effective execution. The HALS business continued to grow sequentially supported by a healthier product mix and increasing contribution from higher margin products. Building on this momentum, this quarter marked a meaningful milestone for us as we achieved EBITDA breakeven in the subsidiary Clean Phenochem Ltd.
We are encouraged by the progress and remain confident in sustaining this momentum. A little on CAPEX Update the Hydroquinone and catechol was commercialized in the month of December and customer trials are ongoing. With commercialization of these products we will have immediate moderation in raw material cost of both the end product that is TBHQ and Veritrol. The commercialization of the hydroquinone plant and the expansion of TBHQ are strategically aligned with our purpose driven growth and value optimization strategy and are expected to enhance existing product margins. Further. CAPEX timeline of performance chemical 2 is as per plan and we expect to commercialize in Q1 FY27 with our reworked process, we have sent newer samples to customer for our Pharma Intermediate dhdt.
While the testing is underway, we expect to have clearer outcomes over the next coming few weeks. During the last nine months the capital infusion in subsidiary has been 150 crores with now the total investment in subsidiary around 700 crores. On account of corporate governance, in line with our commitment to dividend payout policy, the company has approved an interim dividend of Rs 2 per share. We are also Very happy to announce and welcome two new board members, Mr. Raj Kamal and Mrs. Pallavi Gokhale as successors to our earlier retiring independent directors. With this we continue to uphold the highest corporate governance standards.
With this I conclude my opening remarks and look forward to the Q and A. Thank you so much.
Questions and Answers:
operator
Thank you very much. We will now begin the question and answer session. Anyone who wishes to ask a question may press star and one on their touch tone telephone. If you wish to remove yourself from the question queue, you may press star and 2. Participants are requested to use handsets while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. The first question is from the line of Jason Soans from IDVI Capital. Please go ahead.
Jason Soans
Yeah, sir, thanks for taking my question. So first question just pertains to, you know, the, I mean the two Capexes which we had mentioned. Now you have spoken about performance chemical 2 and 1. So going back, of course you were investing 1.5 billion in both of these projects. So just wanted to know, sir, I mean according to your internal, I mean calculations, how much revenue do we expect these. Both these projects to, you know, to generate in 27 and 28? Just as a broad outline, I know you have spoken about an asset turn of two for both these projects.
But just 27, 28, just some specifics could be given.
Siddharth Sikchi
So typically in these fluid market conditions you would avoid giving any forward looking statements. But to just pinpoint with the Performance Chemical one, because of the prices reduction, overall. 80% capacity utilization, we are looking at a revenue of 260 crores which was earlier 320 odd crores. And Performance Chemical to the Capex is under, I mean we are still under Capex phase. And the facility will only begin by May June. And we expect after teething issues, customer approvals, we should only see revenues in Q4.
Jason Soans
Okay, so Performance Chemical 2 will be commissioned by May, June and then probably Q4, you will get some revenue from that, right?
Siddharth Sikchi
Not full revenue, of course. Staggered revenues.
Jason Soans
Yeah, staggered revenue. Okay. Okay. Okay. Okay. Sure, sir. And sir, again now with regards. Yeah, and with regards to hall. With regards to halls, I’m sorry, the hindered amount. Light stabilizer. Just wanted to understand, you know, you know, how much volumes and realizations are we targeting for 26 and 27? Now 26 is almost done, but how much volumes and realization and dollars are we targeting for 26 and 27?
Siddharth Sikchi
I mean for this year we are already at 2,000 tons of volume for nine months. And I mean, I mean you’ll be happy to note that year on year we have reported a 55% growth in hand sales for this particular quarter. And our target trends like that’s typically with any new product which we are commercializing at least around 50% of utilization over two year period. Now HALS has been a different case because this is a totally new zone which we have entered into. But our endeavor continues to remain to stand by that guidance.
Jason Soans
Okay. Okay. And just a realization would be around five dollars that that range or five.
Siddharth Sikchi
And a half dollar.
Jason Soans
Or are we looking at a lesser realization?
Siddharth Sikchi
Our blended portfolio realization for this quarter has been 425 rupees a kilogram.
Jason Soans
425 rupees. Okay.
Siddharth Sikchi
Predominantly the sales is being driven by HAL 770.
Jason Soans
Okay. Sure, sure. And just lastly sir, just wanted to understand. I mean you did spoke in your initial comments about. I mean probably losing a customer in the cosmetics segment. Just. I missed that comment. Was it in the performance chemical segment or. Or what? What segment was that?
Siddharth Sikchi
FMCG segment where a product called 4Map where we lost a customer in China and due to secondary impact of tariff of our end customers in India they have lost their business in United States and hence we are impacted by them as well.
Jason Soans
Sure. Thanks. I have more questions. I’ll come back in with you. Thank you so much. Thank you so much.
Siddharth Sikchi
Thank you.
operator
Thank you. The next question is from the line of Sanjay Jain from ICICI Securities. Please go ahead.
Sanjay Jain
Good afternoon Siddharth. Thanks for taking my questions. I got few. Let’s go segment by segment. First of the performance you did mention two things. One, you said MEHQ and HALS has a lower volume. But you also mentioned that there was no competition in the domestic market. At the same time in the opening remark you said that China has started producing some of these molecules. Can you give us a complete roadmap on performance established molecule? It is China which has got aggressive and hence we have seen mehq BHA volume decline or was it general demand? Slow down.
What’s your take on meHQ and BHA?
Siddharth Sikchi
First let me speak on meHQ. So the reason of price drop. This reason is because overall pricing of hydroquinone which is in the old process, the conventional process to make me HQ starts from hydroquinone. Now because the Chinese have lowered the prices of hydroquinone all time low price and hence the conventional process of hydroquinone to MeHQ makes me HQ also at a lower cost point. To attribute to this we have no choice but to lower our Prices of MEHQ to compete with these emerging players of hydroquinone derived MESQ in China. That is point number one.
Are we clear on this? Okay. Yeah, but.
Sanjay Jain
But we said that there is still no price decline. What you’re mentioning the price decline in MEHQ is to hit our PNL or it’s already there in Q3 it is.
Siddharth Sikchi
Already mentioned in Q3 so we have.
Sanjay Jain
Already taken 13 Q3 we have taken.
Siddharth Sikchi
That we have reduced the prices because the endeavor was to keep volumes intact. But so this has happened bha no, there is nobody in China. When I mentioned about domestic player I was pertaining to the players which announced coming in MEHQ or BHA or Goycol and fomap. That is what I meant that we have not seen any competition from these players so there is no volume loss to these players is what I wanted to mention on the call.
Sanjay Jain
And reason for me BHA being slower for us Is it sizing driven or it is more volume driven unlike mvhd?
Siddharth Sikchi
No, the BHA we reduced it went lower mostly in quarter three. It is a very typical standard because the drop has happened in North America there was some tariff related concern and also because a lot of customers prefer to have lower stocks at the end of December month. So that impact is not as huge as the other products.
Sanjay Jain
And you mentioned about China starting certain product. You mentioned about HQ and Mehq value chain.
Siddharth Sikchi
Yes and 4 map which is the last customer in China and also indirect tariffs which has hit our customer and hence we are hit by them.
Sanjay Jain
Got it, Got it. Now we forward integrate me HQ to make bha. Can that be possibility in China as well? Now that they have started manufacturing me hq.
Siddharth Sikchi
The possibility in China is very difficult to mention today.
Sanjay Jain
I agree, I agree. I know it’s very very open ended but have you seen any sign is my question. Sorry putting it so open on.
Siddharth Sikchi
No, no, there is nothing today. There is nothing today.
Sanjay Jain
Got it, Got it. Now. Now coming to the FMCG last quarter you mentioned that probably that poor MAP customer is also looking to backward integrate or it’s purely the US thing which has hurt or the customer not going to backward integrate sometime can he come back or that possibility is ruled out?
Siddharth Sikchi
No, I mentioned even in the last con call and I’m re repeating it again. That customer I think is dead. I mean it’s lost for us because they have backward integrated. So that remains for China. However the Indian customers and the customers in other parts the reason is because say our end product of 4 map is evo benzone now evobenzone from India has a tariff of 55% in the United States. So all the Indian customers who are buying have slowed down dramatically because of this severe impact of tariffs from the US.
Sanjay Jain
So what is the revenue hit from the Chinese customer? So we know that there is a permanent loss and remaining can come back.
Siddharth Sikchi
Product wise or customer wise we are not comfortable sharing.
Sanjay Jain
No, that’s fine. I was just from modeling perspective how much should I take as a recurring loss and how much is recoupable? But. But that’s fine, that’s fine.
Siddharth Sikchi
But yeah, it’s safe to anchor that you can take probably this quarter as a run rate going forward at a.
Sanjay Jain
This quarter as a right run rate to look at, right?
Siddharth Sikchi
Yes, yes, yes.
Sanjay Jain
Okay.
Siddharth Sikchi
We are not factoring in any further customer loss in this run rate.
Sanjay Jain
Got it? No switching to HQ and catechol HQ we will use obviously for TBHQ and the agro intermediate how much will be captive demand for HQ? For us that’s number one, number two catechol. What are we planning with that product?
Siddharth Sikchi
So categol, the current plan is to of course make our own in house wear a draw which anyways we are making. We are also talking to companies within India who are buying catachol to make some of the derivatives because if you. There is no current, I mean no current production happening of catechol within India at the moment. At the moment. So we are also talking to these customers within India whether we can have a contractual arrangement with them. So that are the two applications and also we are started to export. We have recently got some orders from China to export catechol and that you shall see starting from February itself.
It.
Sanjay Jain
Largely goes into making I think Cambly wish to make it in a large quantity. He doesn’t make it anymore in India.
Siddharth Sikchi
No, I am not aware of what is happening with them but I just think probably, I mean I have no comment on the competition but I don’t see lot of catachol available in the market available and all is imported currently from China. If you see the import data currently all the catacol is imported either from China or by solway. So this is a market which we want to capture first being the local player and giving services like just in time to the customers.
Sanjay Jain
That’s fair On HQ that entire HQ we will use in house or we will also have HQ to sell in.
Siddharth Sikchi
The market we will have a lot of HQ to sell probably we will be only using about 15 odd percent for our own captive and the balance will be sold in the market that is both international and local.
Sanjay Jain
Got it. That’s great. That’s great. I think I got all my answers. Just one comment on ebitda. I know you mentioned that it’s quite fluid and uncertain time and you don’t want to give any guidance, but at the start of the year you mentioned that 40% EBITDA margin at Consol was something we were aspiring for. We have hit 33. What should one look at an EBITDA margin for this year at the Consol level?
Siddharth Sikchi
I know, I know, I understand. But with the way the pricing are being driven by the Chinese, the way things are, also with the tariffs, the uncertainties which we are seeing, it would be appropriate to wait for at least for a quarter to really understand where we stand. So probably in the next quarter or the end of the next quarter we can have this discussion. Please.
Sanjay Jain
No, that’s fine. Thanks for answering all those questions so patiently and best of luck for the coming quarters.
Siddharth Sikchi
Thank you, Sangesh.
operator
Thank you. The next question is from the line of Abhijit Akela from Kotak Securities. Please go ahead.
Abhijit Akella
Yeah, hi, good afternoon. Thank you so much for taking my questions. So maybe just to start with the volume versus price breakdown of the revenues this quarter. If it’s possible to share that, please. On a QOQ and YOY basis.
Siddharth Sikchi
So on QOQ basis, the volume decline out of the 13% decline majority is by volume decline. And on YOY basis, out of the 21%, the volume decline is 19% whereas the price realization is 2%. So majorly it’s volume decline.
Abhijit Akella
Got it, thank you. And just on hals, on a sequential basis, what would the volume trajectory have been like 3Q versus 2Q.
Siddharth Sikchi
So on sequential basis, we have witnessed 6% growth in volume. So this quarter we have almost crossed 800 tons in volumes. Almost 810 tons is the sales volume. And just to add over that, the product mix has also improved. Meaning 944 is now almost contributing 20% to the HAL’s portfolio.
Abhijit Akella
Okay, so on a revenue basis, how much would the growth have been sequentially enhanced?
Siddharth Sikchi
Sequentially.
Siddharth Sikchi
5, 6%.
Abhijit Akella
Revenue as well. Is it volumes as well as revenues?
Siddharth Sikchi
Volume last quarter was 760 tons. This quarter it’s close to 8, 10 tons.
Abhijit Akella
Yes. Okay. And just to understand, you know, this tariff impact which is happening because of destocking, I guess primarily by customers. So across the major products that we have, you know, what categories of customers are these? Exactly? I mean, MEHQ or You know, I don’t know. BHA Guaya call as well. What categories are these and are we seeing any maybe green shoots in terms of their demand in the new calendar year.
Siddharth Sikchi
So I think there are multiple factors there. I think there are some reasons are also impacting the sales in North America as well as in Europe. Also because their end product could also be impacted by competition from the Chinese. So that would have also led them to cut down their production which implies that their off take has also reduced which is, which is contribute. I mean that is what completely impacts us as well. Because if their contribution or their sales has reduced, purchases have reduced so that impacts our sales. That is one level. And of course the second is with the uncertainty which remains on our products on tariff.
The customers are very careful in deciding when to order and how much to order. So these are two impacts which we are seeing whether this will improve I think with tariffs not going anywhere. So that impact of tariffs still remains. And the prices which currently we are seeing in the chemical market segment primarily led by the Chinese is also I think might remain for the quarter or two. So the impact would be at least continue for the next two quarters if not more.
Abhijit Akella
That’s clear. Understood that. And just last couple of ones from my side. One is with regard to this roadmap, as and when maybe demand comes back from the customers that have been impacted by tariffs, would that be adequate to sell out our full capacity despite the loss of the customer we have had or will we sort of need to.
Siddharth Sikchi
A lost customer will, I mean whatever volumes we used to make for him, that customer, that volume is lost, is lost. Others might not be able to recover their volume as well as that volume. So I think we would be seriously evaluating what can we do out of that facility which of course we are working on or making something interesting out of these products so that we can keep utilizing these facilities.
Abhijit Akella
Got it. And the last one from my side is actually regarding the promoter slide in the presentation. The title says strong visibility on longevity of promoters engagement in the business. So just wanted to seek your perspective on whether we should interpret that to mean that even after the expiry of the three year lock in period that you know there will not be any further ofs from the promoters or you know, any comment you could offer on that point.
Siddharth Sikchi
Of course the promoters, I mean though there was a three year period or so, but of course, I mean all of the promoters are equally engaged in the business and all want to work towards the well being of the company. So there will not Be in my view there will not be any further dilution by the Boop family in the next couple of years.
Abhijit Akella
Yeah, I guess the lock in was anyway for three years. So I guess the question pertains to beyond that. So any thoughts beyond that as well?
Siddharth Sikchi
It is a very subjective decision by the family. I mean by the Boop family I cannot really comment but unlikely that they will even sell beyond three years and not in these markets which I am sure you understand. So I think it can be a delayed process by then.
Abhijit Akella
Thanks, really appreciate your frank answers. Thank you so much and wish you all the best.
Siddharth Sikchi
Thank you so much.
operator
Thank you. The next question is from the line of Ankur Perival from Access Capital. Please go ahead.
Ankur Periwal
Yeah, hi Siddharth, thanks for the opportunity. First question, you know on the geographic breakup, if I Look at the Q3 numbers in specific, domestic demand slowdown probably was a bigger factor here. If I look at nine months, obviously China is also contributor here. So any thoughts from a demand uptick both in the international markets as well as on the domestic side.
Siddharth Sikchi
So domestic first let me understand the international. International. Yes, definitely. Both In Europe and US we have seen decent decline closer to 15, 16% in these markets. As I mentioned right now it is because of two factors. One is tariff and other is whether they’re being impacted by the global acrylic acid prices which have come down and they are at its all time low point. So that is the reason, that is why the Europe and the sales are down. In terms of India, these were just campaign related cycles I think which have moved or postponed and it is a very customer centric thing.
So when these at camp cycles come back, probably these volumes will again come back. But we have not lost the volumes. I just want to repeat this. The volume is not lost, it is postponed.
Ankur Periwal
Sure, Siddharth. And just you know, on the volume bit, is it largely the macro or is there a risk of, you know, the backward integration what we saw in four month also playing out in some of our leading products.
Siddharth Sikchi
There see the leading products, you have to understand these are performance chemicals. So these are again as I mentioned, these are performance chemical which are. So an acrylic acid is the biggest example where me HQ 1000 ppm mehq or a 2000 ppm hydroquinone is used. So a backward integration to these would not make any sense to the buyer, I mean to the customer. This was particularly a particular example of format because evo Benzon has 60% of the cost of raw material depends on format and hence it made probably logical sense for them to do so, but not in other segments.
Ankur Periwal
Okay, so it’s largely the end product driven demand which is slowing down and possibly maybe a couple of quarters and then there should be some leg up there.
Siddharth Sikchi
Absolutely.
Ankur Periwal
And another thing on the pricing bit, given what you shared on the China bit as well, the pricing in the overall, let’s say HQ value chain, presuming these prices are what they are, let’s say when one year down. What will. Be your thoughts in terms of the cost economics for us or probably the pricing and whether these margins probably can hover, you know, in this range only.
Siddharth Sikchi
Going ahead, if everything remains the same, then this is what is going to happen. I mean if your question is if prices of finished good is going to remain at this point, assuming the raw materials are also at the current, I mean the oil prices are also at low point. So if this continues for two quarters then the number remains the same over the next two quarters as well. Right.
Ankur Periwal
So my question was more like let’s say, you know, let’s say three, four quarters out, the volume growth recovery comes back. But the pricing is what it is. How much is there further sort of, you know, scope for us to probably improve our costing in terms of improving the margins or probably it’s only the operating leverage which will play out on.
Siddharth Sikchi
Those will play out. We will try and optimize some of the costs. So these are initiatives which we are taking constantly on trying to improve the prices. But again I mean whatever we do, we cannot. I mean because these are so squeezed out products for us that I don’t see anywhere that we can do some magic and reduce the prices by 10%. So it will be very marginal. What I can do but rest the prices are currently driven by the world market itself.
Ankur Periwal
Sure, fair enough. And just lastly on hals, how has been the geographic mix? Now you did mention, you know, the higher end products, you know, seeing some pickup which is driving their beta break even as well.
Siddharth Sikchi
How should we see that domestic? Currently Ankur 70% is domestic, 30% is international. But you will start seeing as we move in quarter four and then subsequently in 27, this mix will start changing and we expect the exports to quickly start ramping up.
Ankur Periwal
Yeah, we were waiting for some product approvals to come in from Europe and other countries.
Siddharth Sikchi
Yes, we have got some of these approvals and in fact in month of January also you will start seeing lot of shipments happening in the United States. But yeah, you will start seeing more action in the export markets.
Ankur Periwal
Okay, that’s it for my sir. Thank you. And all the best.
Siddharth Sikchi
Thank you so much, Ankur.
operator
Thank you. The next question is from the line of Archit Joshi from Nuama. Please go ahead.
Archit Joshi
Hi sir. Thanks a lot for the opportunity. So first question on meHQ. I mean you did explain quite well as to how MEHQ prices have come off. But sir, the entire letdown in HQ prices would also be a function of phenol prices coming off. Would it be right to assume that with phenol maybe pricing cycle going higher HQ prices will also eventually be on the higher side and we will have the MEH prices also going upwards. So is this like a very transient situation? A slight extension to the same question. Like you mentioned before, HQ also is used as a polymerization inhibitor.
So is there a drought, Is there a down trading that is happening from me HQ to HQ which might have added into this volume loss?
Ankur Periwal
No.
Siddharth Sikchi
No, no. Okay. There are a couple of questions you asked. Let me start by the last one. See these processes of interchangeability of performance added is not. I mean I’m sure people would have done this in the past. But these are now set rules of the game. So I don’t think those shift has happened that people have replaced me HQ to hq. So that has not happened number one. Number two, yes the phenol prices have come off. But I have seen these phenol prices couple of times in my 20 year of working career. But the prices of HQ and MEHQ which I am seeing today are the prices which were not even.
These are not even. I mean they are below 20 or low prices. So what I am trying to mention is just raw material play is not playing out. There is also competition and the prices of lower prices of hydroquinone is also pushing lowering prices of mehq. And hence we have to lower the prices to keep our volume up in these markets.
Archit Joshi
Got it. Got. That’s why the fluidity in the situation. I get your point. So secondly, on the hydroquinine catechol plant that we have had, I believe we did have plans to have better yields of HQ and catechol compared to the competitor. Where would we be in that learning curve? Or have we already achieved that yield that we had expected earlier?
Siddharth Sikchi
So I can say that probably we are better than the competition. But we are still a little away from where we had expected to be. And probably all the endeavors we are still trying to figure out how to reach at that point which we had anticipated. So actually we are in midpoint between the competition and the perfect scenario. We are actually in the midpoint and probably in the next couple of months we should reach the better yield process. Sure.
Archit Joshi
Understandably. Sure. So the same question on HQ and Catacol, on a overall margin basis, would we be at par to what we are doing in terms of EBITDA margin?
Siddharth Sikchi
No, no, I don’t think, no, that EBITDA margins will not be at those extent. They would be that they will be lower, I think they’ll be better than health, lower than the parent business. So again they will be like midpoint and with these current prices of hydroquinone which we are currently seeing and because they have declined quite a bit. So I think it is again a very fluid condition to mention really on the EBITDA front, probably another quarter or so to understand where it all stabilizes, how our plants also stabilizes and I think we will have some better picture.
Archit Joshi
One last on hals. I believe in the previous quarter a few global majors have taken a price hike in hals. Is the overall global situation in HALS improving by that price action that they had taken? Anything that would like to comment on how margins and prices can be in house, let’s say one year down the.
Siddharth Sikchi
Line, I think those announcements were made. Yes, we have also seen those public announcements, but they have not really translated into reality. So we have to just keep a wait and watch scenario. But they have not been implemented by the competition yet.
Archit Joshi
Understood. So the situation broadly is status quo on the total supply demand dynamics of. Hals, let’s say yes.
Siddharth Sikchi
So we have to keep working and keep improving our wallet share and that is what we are doing. And despite of those low prices, I think the improvement has completely happened because of our improvement in our process efficiency and of course because these higher grade has also started picking up. So I think this will keep improving over the next few quarters.
Archit Joshi
Understood, sir. Would it be fair to assume that our cost competitiveness in health will be better than our peers globally or we are still in that learning curve to improve our yields or maybe cost to that extent?
Siddharth Sikchi
See, I think we are still see it is very difficult to understand the competitive processes of the other competition and what are their yields and norms. But what I believe is we are still not at the most optimum situation because I think we are still improving. Like if you can see between Q2 and Q3 also there is an improvement in the process efficiencies and I believe there is still more scope for us. And I think that is what makes a little difference. That because these products are all created in house, we have an ability to improve the process further and the endeavor is to further improve these so that it will start meaningfully impacting our EBITDA levels.
Archit Joshi
Got a point sir, Thanks a lot for answering all the questions and wish you all the best in these tough times. Thanks. Thanks a lot.
Siddharth Sikchi
Thank you so much Arisha.
operator
Thank you. The next question is from the line of Bala Murali Krishna from Oman Investment Advisors. Please go ahead. You can go ahead with the question. You are unmute Bala. As there is no response from Bala side, we move to the next question. The next question is from the line of Jason Soans from IDBI Capital. Please go ahead.
Jason Soans
Yes, yes, thank you so much for taking my question again. So you explained very much detail about the HQ prices and how you know that those prices are going down. Now I understand that that they’re in an all time low. Just wanted your take on sir. I mean there’s a lot of talk about this China anti evolution drive going on where you know they’ll basically focus on getting back to market dynamics. Do you expect by any chance this drive to basically at least gradually there’ll be some uptick in those HQ prices? It will help you gain pricing advantage.
Siddharth Sikchi
See, I mean I have also been reading a lot of articles but I think it’s better to see in reality than to make assumptions because you know what is said and what really happens is absolutely two different scenarios. So all our costings and all our pricing currently we are based at the current market situation rather than speculating of any price increase from the Chinese competition.
Jason Soans
Okay, okay. And just the next question, I mean I understand both these 1.5 million CAPEX which they have been a little bit delayed. I understand tariff thing and you explained that the situation is fluid now. I just wanted to understand sir, the performance chemical one at least must be ready. Are we expecting it to generate revenue by when do we expect in 27 to 20 for it to generate any revenue and how much?
Siddharth Sikchi
So the plan started currently we are using because there are teething issues, the product is slight off spec but we are currently consuming all the products in house. So where I was importing say probably around 70, 80 tons of hydroquinone per month, you would have seen that those imports have stopped completely. Same is the case with Catacol which we were importing to make our own Veritrol. So these imports have stopped completely. So all these current products are being serviced by our own subsidiary to the parent company. That is point one and point two is we’ll start seeing sales starting in the month of February and of course gradually increasing in March.
And of course we expect decent numbers coming in FY27.
Jason Soans
Okay. But performance Chemical too. So you expect revenue only in the last quarter that’s been a little bit delayed from that perspective, right?
Siddharth Sikchi
Yes, I think we had anticipated that we will start the production in March, but now I feel with the current scenario we’ll start by May. So there has been a two month 60 day delay, probably another 15 odd days for water trials and commissioning. So yeah, there has been a quarter delay. Yeah, you’re right.
Jason Soans
Right, right. Okay. Okay. Sure. Sir, thanks. Thanks a lot for taking my questions. Thank you.
Siddharth Sikchi
Thank you.
operator
Thank you. We’ll take the last question from the line of Manish and individual investor. Please go ahead.
Unidentified Participant
Hi sir, can you hear me?
Siddharth Sikchi
Yeah, we can hear you.
Unidentified Participant
Yes. Hi sir. So I’m a retail investor. I have, I have written a mail to you as well. So. So what I understand from the layman term as a Lehman term that we have some loss from China because of some customers and we have some loss from us. Right. So that’s the reason we have because of the tariff. So we are losing revenues on, on top of it because of the Chinese competition. We are losing revenues. Right. So we are hit from all banks. Now what do you, what message do you give to a retail investor who have been invested in you since long when can we see the margin that we used to do around revenue growth that we had around 21 to 23 to come back.
Siddharth Sikchi
So Maniji, thank you for your question. Of course, the endeavor for us is always to keep making more profits. But alongside the endeavor is also to retain our market share in the segments because it has taken us 20 long years to build these markets, to retain these customers. But the macroeconomics is something which is, which is very difficult and which is beyond our control. So a tariff of 55% in United States was never anticipated. The overcapacities in China was never anticipated. And all this has led to margin reduction. However, the endeavor is to come up with new products.
The endeavor is to de risk from couple of products to more products. The endeavor is to keep performing and doing R and D and to get more and more products online so that the revenues built up keep happening. The endeavor is to not lose a customer to a competition. So these are some things which I as a promoter have to do to make sure that my business does not, I mean, you know, it’s not a quarter business but that we run for a couple of years. I mean we have to look for a Five year strategy in the company.
So with all this, yes there has been a hit. But we are there. I mean we are healthy in terms of cash flow. Company still sitting on 500, 450 crores of cash. The projects which we had mentioned have all happened beyond. I mean within probably a less than a quarter delay. But all the Capexes have happened at the project cost which we had anticipated despite of all these volatile times. So I mean we are trying our best. I can only say that. And even our endeavor is to reach those profitability. But. But with the macroeconomics in hand, I mean we have.
I mean some things which we cannot control. We cannot control.
Unidentified Participant
Agree. Agree. Sir, I’ve read about you a lot. You know I’m a great fan of yours. How you built up this company along with the book family. So I respect that, you know. But I was just coming from a retail point of view. You know, many, many retailers. I’ve seen many friends of mine. Everyone is scared. Everyone is scared what will happen next. Okay, so that’s the reason I thought of asking you. And second one more question that I want to ask you is. You know the. The trade deal that we had right as of now with Europe that might help us.
That might help us to negate some traffic or that might help us if you compare to China, China has some tariff. Because if you see China has some tariff in you, Europe, eu but we don’t have that. So do you see that playing around? And why. Sorry sir.
Siddharth Sikchi
Yes, I agree with you, that would play. But of course our. I mean this. I think this will only start in 27. I think it’s still a lot of paperwork has to be done between the two countries. So it is not going to. I mean you will not see anything on immediate basis. This will I think only start in 27. And the trade impact would have a five and a half percent to 12% is the tariffs which we pay versus the. And also the Chinese. So if those will come out then of course it will help the Indian chemical industry for sure.
Versus the Chinese of course.
Unidentified Participant
Yes. So we have one. What do you say? Positive for the fda. And also why don’t we capture the market of Australia? Have you any plan to do that? Or Canada by any chance? Because you know by such a condition going on, Canada is anti US. Sorry sir.
Siddharth Sikchi
No, the point is sir, Australia or Canada, they don’t have such acrylic acid plants even for that matter even India does not. India has only one acrylic acid plant. Plus all these blends of pet food industries where we supply there is they are users but they are not producers. Hence Australia is not a market for our products at the moment.
Unidentified Participant
Okay, thank you sir. All the best. We hope to see. We hope to grow with clean sense. Thank you, sir.
Siddharth Sikchi
Thank you so much. Manish. Thank you so much.
operator
Thank you. I now hand the conference over to Mr. Siddharth Sikchi for closing comments. Over to you, sir.
Siddharth Sikchi
So thank you all for spending time with us on Saturday. I understand there has been. I mean it has not been a greatest quarter for us. I think we have had a glitch in our quarter three also as well as in quarter two. But I can only assure that we are working towards improving the margins, improving the revenues, bringing new products online as quickly as possible, trying to maintain our capex cycles. And I think we are trying to do as a team whatever best can be done. And I think that’s all from our side. Thank you so much.
operator
On behalf of Clean Science and Technologies limited. That concludes this conference. Thank you for joining us. And you may now disconnect your lines.
Siddharth Sikchi
Thank you so much.