Smruthi Organics Q4 Profit Drops 52% To ₹1.1 Crore Despite Sequential Revenue Recovery

Mumbai: Smruthi Organics Limited reported a 52 percent year-on-year decline in net profit to ₹1.1 crore in Q4 FY26 as lower revenue and labour code-related expenses impacted earnings. Revenue from operations stood at ₹29.1 crore during the March quarter compared with ₹38.1 crore in Q4 FY25, although it improved sequentially from ₹22.3 crore in Q3 FY26. Compared with profit of ₹1.4 crore in the preceding quarter, quarterly earnings moderated amid higher operating costs and exceptional employee benefit provisions.

Total income during the quarter declined to ₹29.1 crore from ₹38.2 crore in the corresponding quarter last year. Total expenses fell to ₹27.4 crore from ₹35.4 crore a year earlier, with raw material costs at ₹12.1 crore against ₹19.4 crore in Q4 FY25. Employee benefit expenses increased to ₹4.5 crore from ₹4.2 crore, while depreciation charges rose to ₹1.8 crore from ₹1.5 crore. Profit before tax declined to ₹1.7 crore from ₹2.7 crore in the year-ago quarter.

Sequentially, revenue improved 31 percent from Q3 FY26, aided by stronger bulk drug and intermediates sales. However, profitability weakened as the company recognised an exceptional expense linked to implementation of India’s new labour codes. Smruthi Organics booked an estimated additional gratuity-related expense of ₹46.26 lakh during FY26. Earnings per share for the quarter stood at ₹0.93 compared with ₹1.22 in Q3 FY26 and ₹1.95 in Q4 FY25. The company also confirmed discontinuation of its formulations marketing division to sharpen focus on core bulk drug operations.

For FY26, Smruthi Organics reported revenue from operations of ₹102.0 crore compared with ₹126.0 crore in FY25. Annual net profit declined marginally to ₹3.4 crore from ₹3.6 crore in the previous year, while total comprehensive income stood at ₹3.6 crore. The board recommended a dividend of ₹1.50 per equity share of face value ₹10 each for FY26, subject to shareholder approval at the upcoming annual general meeting.

Smruthi Organics said its statutory auditors issued an unmodified opinion on the FY26 audited financial statements. This report is based on audited financial disclosures and is not investment advice.

Disclaimer: This article is based on the company’s regulatory filing for Q4 FY26. It is for informational purposes only and does not constitute investment advice or a recommendation.