In the last 15 months, broader markets are down around 20%. What’s good though is that investor’s sentiment and participation is also down as reflected by Google Trends data, Avg. daily turnover data of NSE and Market Breadth Data.
It’s a great time for stock picking and portfolio restructuring. Those who will invest in growth stocks trading at reasonable valuations today, will probably make great returns on portfolio over the next 3-5 years.
Today, sharing with you the key takeaways from Madhusudan Masala Limited’s Q3 & 9M FY26 earnings conference call, where management discussed business performance, capacity expansion, margins, and growth strategy.
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Madhusudan Masala – Notes from Q3 FY 26 concall
Financial performance
- Q3 FY26
- Revenue: ₹76.3 cr (+20.3% YoY)
- EBITDA: ₹8.25 cr (+79.6% YoY) | Margin 10.8% (+357 bps YoY)
- PAT: ₹4.7 cr (+104% YoY) | Margin 6.2%
- 9M FY26
- Revenue: ₹194.5 cr (+19.3% YoY)
- EBITDA: ₹22.3 cr (+40% YoY) | Margin 11.5%
- PAT: ₹12.36 cr (+40% YoY)
Operations & business
- Capacity utilisation:
- Jamnagar: 98–100%
- Rajkot: 100%
- Branded products:
- >70% of revenue in 9M FY26 (vs 62% last year Q3)
- Target: 100% branded revenue by 2028
- Volumes (9M FY26):
- Total: ~16,983 MT
- Branded: ~1,187 MT
- Packets sold: 106 million
- Distribution:
- 7+ states
- 42,500+ retail outlets
- 6,400+ wholesalers
- 358+ distributors
Capex & capacity expansion
- Brownfield (Jamnagar): +1,200 MT added in Q3.
- Greenfield (Phase-1):
- Location: Jamnagar–Rajkot highway
- Capacity: 6,000 MT
- Commissioning: Sept 2026, commercial production from Oct 2026
- Capex: ₹18 cr (already funded)
- Phase-2 plan:
- Additional 12,000–18,000 MT (CTC & grocery products)
- Capex likely ₹35–40 cr (indicative)
- Funding: mix of debt + promoter warrant conversion (₹181 price)
Revenue potential
- Existing Jamnagar facility:
- ₹300 cr at normal utilisation
- Up to ₹500 cr with outsourcing of intermediate processing (SFG model)
- After Phase-1 greenfield:
- Peak revenue potential ₹600+ cr
Growth outlook
- Management reiterates ~30% CAGR till 2030
- Growth drivers:
- Deeper penetration in existing states
- Aggressive expansion in UP & North India
- Distributor additions: 25–30 per quarter
- Retail additions: 2,500–3,000 per quarter (could rise to 5,000+ in Q4)
FY26 guidance
- Revenue target: ₹280–300+ cr (management confident of exceeding ₹300 cr)
- Stronger season in Q4
- EBITDA margin guidance for full year: 10.8% – 11%
Raw material & pricing commentary
- Chilli, turmeric, coriander prices rose sharply in Q3:
- Chilli avg selling price: ₹174/kg (Q2) → ₹241/kg (Q3)
- Turmeric: +₹25–30/kg
- Coriander: +₹15–20/kg
- Management expects prices to remain firm / rise further in Q4.
- Margin management strategy:
- Procure 50–60% raw material in season
- Dynamic pricing + inventory planning
- Price changes in finished goods are gradual and competitive-driven (not 1:1 with RM).
Marketing & branding
- Marketing spend:
- 1–1.5% of sales (seasonal)
- 1–1.5% of sales (general branding: hoardings, FM, etc.)
- Digital marketing:
- To start from Q4 FY26
- E-commerce orders doubled recently (50 → 100/month)
- Sales teams hired from:
- Everest, Goldie Masala, Vitagreen (Punjab done, UP team joining Feb)
Hope you found the blog post useful and it added value to your investment decisions. Sign up for more interesting stock ideas and industry notes.
Disclaimer: This is not a recommendation to buy/sell any of the stocks mentioned above. The securities quoted are for illustration only and are not recommendatory.
Ekansh Mittal
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