SANSTAR - Sanstar

📊 NSE: SANSTAR 🏢 Miscellaneous 📅 Last Updated: 12/14/2025 12:49

💰 Financial Performance

Revenue Growth by Segment

Consolidated revenue for H1 FY26 was INR 366.1 Cr, representing a 28.1% YoY decline from INR 509.1 Cr in H1 FY25. Q2 FY26 revenue was INR 196.4 Cr, down 4.5% YoY from INR 205.6 Cr in Q2 FY25, but up 15.8% QoQ from INR 169.7 Cr in Q1 FY26.

Geographic Revenue Split

Exports contributed 36% of total revenue in FY25, amounting to INR 340 Cr. The company exports to 58 countries across all continents, with a growing share in North America and Europe.

Profitability Margins

Gross margin for Q2 FY26 was 24.8% compared to 27.1% in Q2 FY25. PAT margin for Q2 FY26 was -0.5% (INR -0.9 Cr) compared to 0.7% (INR 1.4 Cr) in Q2 FY25. H1 FY26 PAT margin stood at 0.1% (INR 0.3 Cr).

EBITDA Margin

EBITDA margin for Q2 FY26 was 0.7% (INR 1.4 Cr), a significant decline of 88.2% YoY from 5.6% (INR 11.5 Cr) in Q2 FY25. H1 FY26 EBITDA margin was 0.1% (INR 0.4 Cr) vs 7.8% (INR 39.7 Cr) in H1 FY25.

Capital Expenditure

The company is expanding its Dhule facility with an additional 1,000 TPA capacity expected to be commissioned in December 2025. In FY25, net cash used in investing activities was INR 174.6 Cr, primarily for property, plant, and equipment.

Credit Rating & Borrowing

Long-term bank facilities are rated CARE BBB+; Stable and short-term facilities are rated CARE A2, upgraded from CARE BBB; Stable / CARE A3+ in April 2025. Finance costs decreased from INR 10.74 Cr in FY24 to INR 7.54 Cr in FY25 following debt repayment from IPO proceeds.

⚙️ Operational Drivers

Raw Materials

Maize (corn) is the primary raw material. Maize grinding volume grew 32.61% YoY to 1,77,922 MT in FY22. Raw material price fluctuations directly impact the sales realization of maize starch.

Import Sources

Sourced domestically within India, primarily from maize-growing regions to support its manufacturing units in Dhule (Maharashtra) and Kutch (Gujarat).

Capacity Expansion

Current capacity is being expanded at the Dhule plant by an additional 1,000 TPA, with commissioning scheduled for December 2025.

Raw Material Costs

Raw material costs are a significant portion of the cost of goods sold, reflected in a gross profit margin of 24.8% in Q2 FY26. Profitability is sensitive to maize price declines which can lead to lower sales realizations.

Manufacturing Efficiency

Maize grinding volume increased by 32.61% in FY22, indicating high capacity utilization driven by demand from textile, paper, and pharma industries.

Logistics & Distribution

The company maintains a global distribution network covering 58 countries across all continents.

📈 Strategic Growth

Expected Growth Rate

33%

Growth Strategy

Growth is driven by a 33% CAGR in export sales (FY21-FY25), capacity expansion at the Dhule plant (1,000 TPA addition), and a strategic shift toward capturing incremental market share in higher-value derivative segments.

Products & Services

Maize-based specialty products and ingredient solutions including maize starch, liquid glucose, maltodextrin, dextrose monohydrate, and sorbitol.

Brand Portfolio

Sanstar

New Products/Services

Focus on higher-value derivative segments to improve margins beyond basic starch products.

Market Expansion

Expanding presence in North America and Europe, which currently show growing shares in the export portfolio.

Market Share & Ranking

Sanstar is one of the largest producers of maize-based specialty products and ingredient solutions in India.

🌍 External Factors

Industry Trends

The maize starch industry is seeing improved demand from pharmaceuticals and food products. The industry is evolving toward specialty derivatives which offer higher margins than commodity starch.

Competitive Landscape

Faces increasing competition in the maize starch industry, which CARE Ratings expects will keep profitability at moderate levels.

Competitive Moat

Moat is built on a 38-year track record, established procurement networks, and a diverse product portfolio with wide industrial applications, making it difficult for new entrants to scale quickly.

Macro Economic Sensitivity

Sensitive to general market and macro-economic trends, including agricultural output (maize) and industrial demand from end-user sectors like textiles and pharma.

Consumer Behavior

Shift toward processed foods and specialty pharmaceutical ingredients is driving demand for maize-based derivatives.

Geopolitical Risks

Global operations in 58 countries expose the company to international trade barriers and regulatory changes in North America and Europe.

⚖️ Regulatory & Governance

Industry Regulations

Operations are subject to food safety standards and pharmaceutical-grade manufacturing regulations for its derivative products.

Environmental Compliance

Investment in Solar and Biofuel plants demonstrates a commitment to ESG and renewable energy to reduce carbon footprint and costs.

Taxation Policy Impact

The company incurred tax expenses of INR 1.8 Cr in Q2 FY26 despite a loss before tax, likely due to deferred tax adjustments or minimum alternate tax.