SHANTHALA - Shanthala

📊 NSE: SHANTHALA 🏢 Trading 📅 Last Updated: 12/14/2025 13:08

💰 Financial Performance

Revenue Growth by Segment

The company reported consolidated revenue from operations of INR 26.94 Cr for the half-year ended September 30, 2025, representing a marginal growth of 0.33% compared to INR 26.85 Cr in the same period of the previous year. Segment-specific revenue splits were not disclosed in the available documents.

Geographic Revenue Split

Not disclosed in available documents, though the company is headquartered and operates out of Virajpet, Kodagu, Karnataka.

Profitability Margins

The consolidated Profit Before Tax (PBT) margin for H1 FY26 stood at 3.68%, based on a PBT of INR 1.01 Cr and total income of INR 27.53 Cr. Standalone PBT for the same period was INR 0.96 Cr.

EBITDA Margin

Operating profit before working capital changes was INR 55.28 Lakhs for H1 FY26, compared to INR 52.69 Lakhs for the year ended March 31, 2025, indicating a significant improvement in core operational profitability on a half-yearly basis.

Capital Expenditure

As of September 30, 2025, the company held Property, Plant and Equipment valued at INR 2.34 Cr. The company is actively scaling operational and production capacities to support growth in FY 2025-26.

Credit Rating & Borrowing

The company significantly reduced its long-term borrowings by 96.7%, from INR 11.37 Lakhs in March 2025 to INR 0.37 Lakhs in September 2025. Short-term borrowings increased to INR 48.49 Lakhs from zero in the previous period. Interest expense for H1 FY26 was INR 3.97 Lakhs.

⚙️ Operational Drivers

Raw Materials

FMCG inventory (finished and semi-finished consumer goods) represents the primary material cost, with inventory valued at INR 1.85 Cr as of September 30, 2025.

Capacity Expansion

The company is focused on scaling operational and production capacities to navigate emerging challenges, though specific MTPA or unit capacity figures were not disclosed.

Raw Material Costs

Inventory levels decreased by 16.7% from INR 2.22 Cr in March 2025 to INR 1.85 Cr in September 2025, reflecting improved inventory management and procurement strategies.

Manufacturing Efficiency

The company is implementing an audit trail (edit log) feature in its accounting software to ensure compliance and operational transparency, as verified by statutory auditors.

Logistics & Distribution

The company is strengthening its execution capabilities and supply chain efficiency to optimize distribution in the dynamic FMCG market.

📈 Strategic Growth

Expected Growth Rate

Not disclosed in available documents

Growth Strategy

Growth will be achieved by scaling operational and production capacities, enhancing supply chain efficiency, and strengthening marketing and execution capabilities. The company is also investing in AI and eco-friendly practices to align with changing consumer demands.

Products & Services

Fast Moving Consumer Goods (FMCG) products, including various consumer staples and household items distributed through its network.

Brand Portfolio

Shanthala

New Products/Services

The company is targeting new opportunities in the dynamic business environment of FY 2025-26, though specific new product names were not disclosed.

Market Expansion

The company is positioning itself to capitalize on India's expanding middle class and accelerating digital adoption, focusing on growth in the FY 2025-26 period.

🌍 External Factors

Industry Trends

The FMCG industry is currently growing, driven by digital adoption and a shift toward eco-friendly practices. The company is positioning itself by investing in AI and sustainable operations to remain competitive.

Competitive Landscape

The FMCG market is described as dynamic, requiring companies to adapt quickly to changing consumer demands and regulatory shifts to maintain market position.

Competitive Moat

The company's moat is derived from its established supply chain efficiency and regional presence in Karnataka. This is sustainable through continued investment in technology and operational scaling.

Macro Economic Sensitivity

The company is sensitive to India's GDP growth, infrastructure investment, and the expansion of the middle class, which drive demand for FMCG products.

Consumer Behavior

There is a notable shift toward digital adoption and a preference for brands that implement eco-friendly practices and AI-driven service enhancements.

⚖️ Regulatory & Governance

Industry Regulations

The company must comply with Rule 3(1) of the Companies (Accounts) Rules, 2014, regarding audit trails in accounting software. As an SME-listed company, it is exempt from certain SEBI Corporate Governance and Related Party Transaction disclosure requirements under Regulation 15.

Environmental Compliance

The company is investing in eco-friendly practices to ensure long-term sustainability and compliance with evolving environmental regulations in the FMCG sector.

Taxation Policy Impact

The company reported a deferred tax liability of INR 0.83 Lakhs as of September 30, 2025.

Legal Contingencies

The company has no pending litigations as of the latest auditor's report dated May 22, 2025.

⚠️ Risk Analysis

Key Uncertainties

Key risks include supply chain complexities and sudden regulatory shifts, which could impact margins by an estimated 5-10% if not managed through AI and efficiency investments.