Godavari Biorefineries Ltd (NSE: GODAVARIB) Q1 2026 Earnings Call dated Aug. 11, 2025
Corporate Participants:
Unidentified Speaker
Prachi Ambre — Investor Relations
Samir Somaiya — Chairman and Managing Director
Ashish Sinha — Assistant General Manager, Investor Relations & Finance
Analysts:
Unidentified Participant
Dhavan Shah — Analyst
Varun Mishra — Analyst
Devanshi Shah — Analyst
Darshil Jhaveri — Analyst
Gaurav Shah — Analyst
Surabhi Sutaria — Analyst
Priti Agarwal — Analyst
Presentation:
operator
Ladies and gentlemen, Good day and welcome to the Godavari Biorefineries Ltd. Q1FY26 earnings conference call. As a reminder, all participant lines 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 touchstone phone. Please note that this conference is being recorded. I now hand the conference over to Ms. Prachi Ambre. Thank you. And over to you, Ma’. Am.
Prachi Ambre — Investor Relations
Good morning and welcome everyone for Godabari Biorefineries Limited Q1FY26 earnings conference call today. On the call we have Mr. Sameer Sommey, Chairman and Managing Director and Mr. Ashish Sinha, Assistant General Manager, Investor Relations and Finance. Before we begin the call, I would like to give a short disclaimer. This call may contain some of the forward looking statements which are completely based upon our beliefs and expectations as of today. The statements are not a guarantee of our future performance and involve unforeseen risks and uncertainties.
With this, I would like to hand over the call to Sameer sir for his opening remarks. Over to you, Sir. Thank you.
Samir Somaiya — Chairman and Managing Director
Good morning everyone. Q1FY26 has been a quarter of positive change for Godavari Biorefineries Limited Advancing our strategic shift towards bio based specialty chemicals and renewable energy based on multiple feedstocks. Despite the seasonality inherent in some of our segments, our performance reflects the strength of our diversified portfolio and our commitment to sustainable innovation. Our revenue from operations stood at 533.2 crores reflecting a year on year improvement. And our EBITDA reached 6.5 crores marking a significant turnaround from the same period last year. Our bio based chemicals segment continues to be a strategic pivot for our growth and transition, registering a robust 43% increase in EBITDA.
This performance underscores the continuing commitment of our customers, both global and Indian to the shift towards green chemistry where bio based alternatives are gaining traction. We are proud to be at the forefront of this transition, collaborating and innovating with Indian and global partners to co create sustainable chemical solutions based on bio based specialty chemicals. The making of ethanol is another of our growth pivots. The restoration of the ethanol blending program from juice and syrup has enabled us to optimize the production from bee heavy molasses in this sugarcane crushing off season as partly reflected in this past quarter.
I’m also pleased to share that our upcoming 200 kilo L day fungible grain maize distillery is progressing ahead of schedule. We are on track to commence commercial production by the end of the calendar year 2025 which will further strengthen our multi feedstock capabilities, unlock new growth avenues and contribute meaningfully to India’s energy transition. The industry’s achievement of 20% ethanol blending is ahead of schedule. The government is examining going beyond a 20% blend with some ministers stating that a 27% blend is being looked at. This signals a strong policy tailwind that we are well positioned to leverage.
We are also making significant strides in our drug discovery initiatives. A novel anti cancer molecule has received a European patent validation across multiple jurisdictions and our safety trials have concluded without any dose limiting toxicity. Additionally, we have secured a Chinese patent for another promising anti cancer compound that has demonstrated strong inhibitory effects on cancer and cancer stem cells in vitro studies. These milestones reflect a deep commitment to innovation and long term value creation. We are also pleased to report that our interest costs decreased by 22% year on year to 15 crores result of our focused efforts in reducing our debt from the same period last year.
This has not only lowered our financial burden but has also created meaningful headroom for future expansion and strategic investment. Looking ahead, our strategic focus remains firmly anchored in strengthening the bio based specialty chemical portfolio through continuous debottlenecking program, process optimization and the development of high value specialty chemicals that cater to the global demand and Indian demand for greener alternatives. In parallel, we are investing in cutting edge research and development with these initiatives. We are confident in our ability to deliver sustainable value to all our stakeholders.
I now hand over to Ashish for a more detailed financial update.
Ashish Sinha — Assistant General Manager, Investor Relations & Finance
Q1 FY26 marked the beginning of a transmission transformative year for us and we are pleased to report resilient financial performance that reflects the early impact of our strategic initiatives. Our revenue from operation for the quarter stood at rupees 533.2 crore compared to rupees 522.5 crore in Q1FY25 indicating a steady year on year growth despite seasonal headwinds in some segments. From a profitability perspective, the quarter saw a meaningful turnaround. We reported a positive EBITDA of rupees 6.5 crore compared to our loss in the same quarter last year, an improvement of Rupees 16 crores. We reported a negative PBT of Rs.
22.3 crores compared to a loss in the same quarter last year of Rs. 41.6 crore, an improvement of rupees 19 crores on PBT front. This shift underscores the effectiveness of our cost optimization measures, growing traction in our bio based chemicals segment, restoration of ethanol lending program and lower interest cost. Gross margin expanded by 512 basis points year on year to 19% driven by our product mix and pricing discipline. This trend gives us confidence in our path to profitability. As we continue to strengthen our financial fundamentals, we remain focused on executing our strategic priorities including debottlenecking specialty chemical development and enhancing multi feedstock ethanol capabilities.
These initiatives, along with the progress on our upcoming 200 kiloliter per day fungible grain or maize distillery are expected to unlock significant value in the coming quarters. Thank you and I look forward to your questions. Please open the floor for the question.
Questions and Answers:
operator
Thank you very much. We will now begin the question and answer session. Anyone who wishes to ask the question may press Star and one on their touchstone telephone. If you wish to remove yourself from the question queue, you may press STAR and two participants are requested to use handsets while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. We take the first question from the line of Dhawan Shah from Alpha Accurate Advisors. Please proceed.
Dhavan Shah
Yeah, thanks for the opportunity sir and decent numbers during the quarter. So my question is on the economic side of the business, I think we were having some very heavy molasses inventory in the last quarter versus there was no inventory in the last year. Still I think on the ethanol side of the business there is some lower profitability. So if you can share some of your thoughts. What led to lower performance during the quarter on the ethanol side.
Ashish Sinha
So hi Dhavan Ashish, this side. So in terms of gross profit margin of the ethanol business that is aligned on year on year basis, however there is a decline in the EBITDA margin by approximately 2%. That is because of the oxygen maintenance we have taken.
Samir Somaiya
At the same time, Dhaval, we are having molasses stock at the end of this last quarter which will continue to give us performance in this sector in Q2.
Dhavan Shah
Understood. So as on fourth quarter 25 and I think we were having roughly one like 9,000 tons of bab molasses. So can you share the numbers at the end of first quarter, what is the closing inventory?
Ashish Sinha
So approximately 40,000 of the behavior, mostly stock we have at the quarter.
Dhavan Shah
Okay, okay. And in terms of the cancer drug, I think we have seen some, you know, the release in the last quarter we have received some patent from two, three countries. So if you can, you know, share thoughts on this part. Also by when can we see the commercialization of this molecule or the numbers, if you can help us to understand. And in how many countries is it still under filing stage and by when do we expect to, you know, gain some momentum over there in terms of the approvals?
Samir Somaiya
Kamal, I’ll give you a broad directionality. For a drug discovery process to be successful, a molecule has to be tested first in pre clinical trials that has been completed. Once pre clinical is successful, you have to do safety trials. Now what we have announced that our safety trials have concluded without any toxicity dose limiting toxicity being reported. That’s the second point. Third point of course is also to find out what is the genetic method of action, mechanism of action. This also we have now established. Next step for us would be to apply to the CDSCO for the trials of preliminary efficacy.
Now these preliminary efficacy trials we need to get approved by cdsco. We are working on this, preparing an application and assuming with that approval we do the preliminary efficacy, we will then explore the route for out licensing this to pharmaceutical companies in India and overseas. This process will take in the range of two to three years.
Dhavan Shah
Okay. Okay. And still in how many countries are we expecting not to get enough role like we have received in last quarter from two to three countries still how many countries are left?
Samir Somaiya
I don’t have the answer with you right now. We have applied for broad patent protection in various parts of the world. I don’t have the exact answer in which countries it is. With balance for today, I don’t have it.
Dhavan Shah
Okay, that’s all from my side. Thank you sir.
operator
Thank you. We take the next question from the line of Varun Mishra from M and S Associates. Please proceed.
Varun Mishra
Hi. So I had a couple of questions from my end. So like so what is the strategic significance of the bioethanol collaboration and how do we see it contributing to the margins in the top line over the next period, like say two or three years.
Samir Somaiya
Can you repeat your question regarding what you mean by the bioethanol collaboration?
Varun Mishra
So basically so like as we have seen the ethanol in the revenue mix, the ethanol portion has been increasing and we have like so like I wanted to know, like understand like how can we see that contributing to our revenues and like the top line and so on.
Samir Somaiya
We see ethanol as an important strategic direction for the government of India that is driven by three pillars. One is supplementing India’s energy security, advancing towards the green energy transition and securing farmer incomes. As a result of that, the government has reached a 20% ethanol blend in petrol. Earlier the target was 2030 and we have now achieved it at 2025. As a nation, the government also encouraged the production and sourcing of ethanol from diverse feedstocks. So we have been pioneers in converting ethanol from sugarcane juice and later molasses. We have now decided to implement a 200 kilo litre SP per day ethanol facility from grain maize.
We believe this initiative is going to help us diversify from climate and policy risk and we are on track to commission this by the end of the calendar year 2025. Recently, Minister Sri Minister Sri Nitin Gadkari has also announced that the government is also examining increasing the 20% blend to 27% and the Niti Aayog is also exploring the same. So as a company we are in sync with the strategy of the Government of India and we believe this will be a growth pivot for us to have a multi feedstock ethanol producing facility to support for the green energy transition of the country.
Varun Mishra
All right, so thank you and like. So you’ve guided a 3x EBITDA margin by FY29. So how much of it are we expected from debottlenecking the existing molecules or ramp up the grain maze or maybe based on ethanol? Could you like throw in some light on that as well?
Samir Somaiya
I think what we have announced is from FY25 to FY29 this 3x increase in margins in EBITDA and we have identified two pivots. One is a pivot of producing greater ethanol capacity and a better utilization of the ethanol capacity facility. And the second is by increasing the quantity of bio based specialty chemicals in our feedstock. Both these pivots will lead to an increase in the EBITDA in terms of the targets that we have articulated.
Ashish Sinha
Just want to add Mr. Varun, with this expansion of 200 km per day of the grain distillery plant, this will start giving me the EBITDA from quarter four of FY26 and the debottlenecking of the bio based chemicals. What we are doing, you see a transition in the financial year 26 but the major impact, what we are talking about the 3X EBITDA which starts reflecting from FY27, 28 and 29.
Varun Mishra
All right. Do we intend to fund this through like internal accruals or like are we planning to do it with some external fundraiser, maybe an equity raise?
Samir Somaiya
We would be explored. We would be exploring means of fundraising with our board and identify the best means to fund it to help the the company in its financing plan.
Varun Mishra
All right, that’s all from my end. Thank you.
operator
Thank you. The next question is from the line of Devanshi Shah from SDF Finance. Please proceed.
Devanshi Shah
Hi. Thank you for taking my question. So my first question was regarding the Catalytics partnership. Could you share an update on the biobutanol and higher alcohol facility under the Catholics partnership? Like have initial commercial volumes begun and what is the expected contribution margin from them?
Samir Somaiya
Ma’, am, that plant was not meant to start already. What we had announced was a licensing of the technology and what we had said in the last meeting also is that we are doing a basic and a detailed engineering of the same. This process is currently still underway and the expectation of the plant startup was in the second half of the next.
Devanshi Shah
Okay, got it sir. Also my second question was as the ethanol and chemical segments scale up, to what extent do you expect the contribution from sugar and causing to decline and what would be a more stable long term contribution range from these segments?
Samir Somaiya
Can you repeat your question?
Devanshi Shah
Sure. So as the ethanol and chemical segments scale up, to what extent do you expect the contribution from sugar and collagen to decline? And what would be a more stable long term contribution range from these segments?
Ashish Sinha
So Devanshi, this chemical and the ethanol going forward. Because the expansion, the expansion, what we are doing and the debottle leaking further and adding a capacity for the bio based chemicals, the margin of the chemical, the beta margin for the chemical would increase. Okay. Sorry, you asked about the revenue.
Devanshi Shah
Yes. What would be the long term contribution range?
Ashish Sinha
Okay, so ethanol would give in the range of 40 45% in the range. The sugar and co generation segment would remain as is flat and the balance majorly would come from the chemical business would be in the range of. 40 45%.
Devanshi Shah
Got it, sir. And also as you expand your portfolio in bio based chemicals, could you provide some color on the product pipeline? Like how many new products are currently in development and what does market demand look like for these offerings?
Samir Somaiya
I’ll broadly answer that. The company has been doing working with customers in India and abroad to co create solutions for their transition also towards a greener alternative in their supply chain. Many of these products range from working in the laboratory, pilot plant, semi commercial and commercial. There is a portfolio of chemicals across these stages and across end use applications such as agrochemicals, fragrance, skin care, pharma, intermediates, paints, coatings, etc. And at any given point in time there is a range of chemicals that the company is working with.
Devanshi Shah
Got it sir. Thank you so much.
operator
Thank you. Thank you. We take the next question from the line of Darshal Javeri from Crown Capital. Please proceed.
Darshil Jhaveri
Hello. Good morning sir. Thank you so much for taking my question. Firstly, congratulations on a great Q1. Hopefully I’m audible, sir.
Samir Somaiya
Yeah. Thank you. You are audible?
Darshil Jhaveri
Yeah. Hi sir. Hi sir. So sir, I just wanted to ask like we’ve given a guidance for FY29 but just want to understand. So the ramp up will come major in FY27, right? So. So our FY26, how should we look at. How should we look at FY27? Like the growth that we are seeing, like the revenues in both ethanol and now base, that should kick in a bit later, right? FY28 or how? Just want to know. The growth will be linear or it will be more back ended. Just wanted to, you know, get an idea of that.
Samir Somaiya
So you know what we have identified is a FY29 target that we have articulated. Improvements will happen from 26 onwards. 26, 27, 28, 29. It’s not like we will be flat for three years and then in one year we will change. It will happen incrementally. You will start seeing effects there. Certain changes will come with debottlenecking. They are more gradual. And with investments in new facilities they are, I will say discontinuous. So for example, when the grain based ethanol facility you will see because of the new capacity additions, you will see a different change. So that’s why what we have articulated is we said that you will see changes in EBITDA year on year from 26, 27, 28 and 29. We’ve said that the ethanol numbers will start reflecting stronger from 26 onwards itself. Chemicals will also show an improvement in 26. But you will see greater change from 27 onwards.
Darshil Jhaveri
Okay. Okay. Fair enough, sir. And so just wanted to know like from the ethanol plant next year, like the new plant, what kind of revenue can we expect? And the margin, sir.
Samir Somaiya
So it’s a 200000 liter per day facility. At a 300 day operation, it would mean 60 million liters. Currently the ethanol price from maize is at little over 70 rupees per litre. So it would be more than 400 crores of revenue. Assuming that the plant operates for 300 days in a year.
Darshil Jhaveri
Oh, that’s great to know. With that, the revenue, the margin is similar to what we are doing right now in ethanol.
Samir Somaiya
It also depends on the maize prices. So it would be hard to pinpoint is our margin figure, but it would definitely lead to an improvement in EBITDA because of the higher operations of the facility and also because you’re going to improve capacity utilization with similar overhead.
Darshil Jhaveri
Okay, okay, fair. Fair enough. I answer this. Can I ask a few more questions or should I get back into the line? Hello.
Samir Somaiya
So you. You may ask.
Darshil Jhaveri
Yeah, so I just wanted to know the new facilities coming in. The chemical business also picking up. So we’ll have better, you know, like better quarterly profitability. Right. So because like right now our most of the profitability is towards the, you know, H2. So that should also change from FY27. Right. So that would be fair to assume.
Samir Somaiya
See the sugar cogeneration and ethanol from sugarcane juice is seasonal. The chemicals business is annual, which means not so seasonal. And likewise the maize to ethanol will also be less seasonal. So as you implement these initiatives, seasonality will remain because there is an issue. The sugar cane crushing business is seasonal. But what we are adding in terms of specialty chemicals and maize based ethanol will reduce the seasonality. But seasonality is fundamental to any agribusiness.
Darshil Jhaveri
Just on the bookkeeping side, what is the effective tax credit that we can assume going forward?
Samir Somaiya
Sir, can you repeat your question?
Darshil Jhaveri
So effective tax rate. Like we had 40% tax in the previous years, like 20 to 23. So just wanted to know like we are taxed at 25% or 30%. Like what’s the tax rate that we can expect?
Dhavan Shah
Sir, 25%. It’s louder.
Ashish Sinha
I don’t know, 25%.
Darshil Jhaveri
Oh, okay, okay, fair enough. I just wanted to know, sir, Now I think maize futures are also being traded to do we use them to hedge our prices because the volatility is there in maize. Right. So are there like any plans of using that?
Samir Somaiya
Sir, we are still implementing the facility. Once we implement the facility or come close to it is when we will start looking at our maize purchases and our strategy for the same.
Darshil Jhaveri
Yeah, because if we could be able to hedge it with maize future prices, then at least our profitability will be quite fixed with if we have things you can maybe look take a look at that strategy.
Samir Somaiya
We will clearly articulate a intelligent maize sourcing program.
Darshil Jhaveri
Okay. Okay. That’s it. From my side. So thank you sir.
operator
Thank you. We take the next question from the Line of Gaurav Shah from Harshad Gandhi Securities. Please proceed.
Gaurav Shah
Yeah, so thanks a lot for the opportunity. Sir, my question is on the anticance cancer molecule. So I heard your response to the earlier participants where we are expecting its commercialization within next two or three years. So just so sir, I just wanted to find out the opportunity size here. Any ballpark figure, t
Samir Somaiya
Two questions, one point. First answer is the preliminary efficacy trial has to be successful and only if that is successful we can examine opportunities for out licensing that this we are. That’s what we articulate. Two to three years. That’s point one and too early it would be to talk about the possibility or the size of the opportunity right now. Okay. But oncology. Oncology is a good subject and triple negative breast cancer is also a good target.
Gaurav Shah
Okay sir, thanks a lot. That’s it for my end. All the best.
Samir Somaiya
Thank you.
operator
Thank you. The next question is from the line of Surbhi from NV Alpha. Please proceed.
Surabhi Sutaria
Thanks for the opportunity. My first question is with the bio based chemicals I wanted to know what capacity utilization are we running at and for the 2 and a half x revenue and you know 15% EBITDA margins that you guided going forward like in the next couple of years what kind of capex would we have to do or is this block enough for this segment?
Samir Somaiya
So there’s a range of chemicals surbhi that we are working on. We are expanding debottlenecking and adding capacity to chemicals where we are finding good demand across sectors as we mentioned. And the other question which you asked regarding CapEx we have identified that to do this a further investment of 325crore crores at today’s prices would be the estimate today which would be needed to go into both the bio based specchem and the ethanol business to have these pivots. We expect about 70% of that investment to be in the bio based specchem side and about 30% to be in the ethanol capacity increasing site. This is the estimate that we have to achieve that pivot that we have.
Surabhi Sutaria
Got it. And what kind of capacity utilization are we running at across products on an average? And also from you know like the realizations how are they trending for some of these bio based chemicals? Where are we in the cycle and do we see any realization uptick going forward?
Samir Somaiya
So again hard to answer this question uniformly. There are some chemicals which are in high demand and so therefore we are debottlenecking those places where the demand is high and the production needs to be debottlenecked. To meet the demand. And so that’s what we are seeing is a strong market for green chemicals right now.
Surabhi Sutaria
Got it. That’s also my thing. Thank you.
operator
Thank you. Before we proceed with the next question, a reminder to the participants. In order to ask a question please press star and one on your touchstone telephone. We take the next question from the line of Preeti Agarwal from SK Associates. Please proceed.
Priti Agarwal
Yeah, thank you so much for the opportunity. I wanted to know that once the 200 klpd grain based distillery is commissioned, how do you expect the ethanol production mix to evolve across and what will be the incremental contribution to revenue and margin?
Samir Somaiya
So we’ve already mentioned that the 200,000 liters per day at a 300 day per year operation would add 60 million liters of product to the mix. Last year our production, Ashish can correct. Me, was about 8.4 crores. So 84 million litres was what we produced last year. So you will see 60 million liters added to that. In addition to what ethanol we will continue to make from bee heavy molasses in these first two quarters. So maize based ethanol will contribute significantly to our overall ethanol production. Okay. And as the turnover you asked what would be the sales? Current prices of ethanol from maize are over 70 rupees per liter. I think it is 72. 72 rupees. So if you had 60 million liters that would be in excess of 400 crores.
Priti Agarwal
Okay, understood. And for the oncology module under development with pre clinical safeties and mechanisms of action milestones completed, what’s the timeline for initiating efficacy trials and processing toward out licensing?
Samir Somaiya
Ma’, am, we are await the clinical. Sorry, the safety trials have just concluded. We are still awaiting what is called the final report which will be used to apply to the cdsco. Then for the next stage of preliminary efficacy trials. Once those are, once that permission to do that will be granted is then when those will be commenced. And after that, assuming that is successfully demonstrated in preliminary efficacy, is when we will start looking for out licensing efforts. Okay.
Samir Somaiya
The process will, you know, we will have to start examining this also to some extent, attending conferences, attending seminars to explain the work we are doing internationally.
Priti Agarwal
Okay, understood. And my last question is that what is your long term plan for the oncology pipeline? Do you intend to build capacities in drug development or will the focus remain on research and development and out licensing the pharma partner?
Samir Somaiya
Maybe we would have a better clarity. We are not intent, you know, we have chemicals, molecules that we have a research team to look at. We will definitely not here to become a pharma company, but we are a innovation based science company. And definitely if there is interest, we will look at opportunities to see how best we can monetize the research intellectual property that we develop.
Priti Agarwal
Understood. Thank you so much sir.
operator
Thank you. We take the next question from the line of Devanshi Shah from SDA Finance. Please proceed. Hi.
Devanshi Shah
I had a few follow up questions. So what is the peak EBITDA margin you expect to achieve in the near term from the bio based specialty chemicals and ethanol segments?
Samir Somaiya
Ma’, am, in that presentation we have identified in FY29 the bio based specialty chemicals. We are saying would an EBITDA in excess of EBITDA to sales margin in excess of 15% is what we have articulated.
Devanshi Shah
Got it. So also what’s the current status of your 2G ethanol initiative and cellulose based pipeline specifically? And how far along are you in terms of technology readiness?
Samir Somaiya
So currently our focus is on the specialty chemicals coming from acetaldehyde and the work on the bagasse valorization is currently in the research stage.
Devanshi Shah
Got it. And my last question was what revenue CAGR do you expect as you move towards your EBITDA target and what are the key growth drivers underpinning this trajectory? Should we also factor in contributions from emerging platforms like 2G ethanol and cellulose based products in this outlook?
Samir Somaiya
Ma’, Am, we will update you as the development on that aspect develops. So that would be at the appropriate time. We have identified the levers of bio based spectrum and the increased ethanol in our presentation. That is how we are expecting our growth pivots to happen.
Devanshi Shah
Got it sir. Thank you.
operator
Thank you. Ladies and gentlemen. Due to time constraints, we take that as the last question. I would now like to hand the conference over to the and thank you members of the management. Thank you everyone for joining the call.
Samir Somaiya
Thank you very much.
operator
On behalf of Godavari Biorefinery Ltd. That concludes this conference. Thank you for joining us and you may now disconnect your lines.