SRHHYPOLTD - Sr.Rayala.Hypo

📊 NSE: SRHHYPOLTD 🏢 Chemicals 📅 Last Updated: 12/14/2025 13:39

💰 Financial Performance

Revenue Growth by Segment

Chemicals segment is the primary driver, with revenue from Wind Energy - Power contributing less than 10% of total revenue. Overall operating income grew 39% in fiscal 2022 to INR 1,268 Cr.

Geographic Revenue Split

Not disclosed in available documents, though the company operates manufacturing in Kurnool, Andhra Pradesh and windmills in Tamil Nadu.

Profitability Margins

Net Profit margin improved to 14.53% in FY25 from 9.29% in FY24 (a 56.46% change). Operating profit margin (PBIT/Net Sales) increased to 19% in FY25 from 13% in FY24 (a 55.24% change).

EBITDA Margin

Operating margins are expected to sustain in the range of 10-12% despite realization drops in specific products like Sulphuric acid. PBIT margin was 19% in FY25, up 55.24% YoY.

Capital Expenditure

The company has modest debt-funded capital expenditure plans. Historical cash and bank balances of INR 130 Cr are utilized for operational needs like coal imports.

Credit Rating & Borrowing

CRISIL A-/Positive (upgraded from Stable) for long-term facilities and CRISIL A1 for short-term facilities. Borrowing costs are low as the company has negligible term debt and a 0.00 debt-equity ratio.

⚙️ Operational Drivers

Raw Materials

Coal (used for power generation) and raw materials for inorganic chemicals such as Sulphuric acid (which also acts as a final product).

Import Sources

Coal is imported against 100% margin as and when required.

Capacity Expansion

Current capacity includes a 10 MW coal-based power generation plant at Kurnool and windmill units in Tamil Nadu. Expansion is described as 'modest' and debt-funded.

Raw Material Costs

Profitability is susceptible to volatility in raw material prices. Specific cost as % of revenue is not disclosed, but realizations from Sulphuric acid sales are expected to drop.

Manufacturing Efficiency

Inventory turnover ratio improved significantly by 63.86%, rising from 11.01 in FY24 to 18.04 in FY25, indicating high efficiency in stock movement.

📈 Strategic Growth

Expected Growth Rate

14.37%

Growth Strategy

Growth is targeted through scaling manufacturing operations to achieve higher cash accruals of INR 130-140 Cr. The strategy focuses on leveraging an established market position in calcium hypochlorite and bleaching powder while maintaining a robust capital structure and prudent working capital management.

Products & Services

Calcium hypochlorite, stable bleaching powder, sulphuric acid, and wind energy power.

Brand Portfolio

TGV Group (Sree Rayalaseema Hi-Strength Hypo Limited).

Market Share & Ranking

Major producer of calcium hypochlorite and stable bleaching powder in India.

Strategic Alliances

Part of the TGV Group; consolidated with subsidiary TGV Sodium and Electrolite Pvt Ltd.

🌍 External Factors

Industry Trends

The industry is seeing healthy demand for inorganic chemicals. The company is positioning itself by maintaining strong liquidity (INR 152 Cr cash) and low gearing (0.09 times) to navigate downturns.

Competitive Landscape

Key competitors include global players in the inorganic chemicals industry.

Competitive Moat

Moat is built on being a major Indian producer of calcium hypochlorite and stable bleaching powder with a 20-year track record and established customer relationships.

Macro Economic Sensitivity

Sensitive to global inorganic chemical demand and international coal prices.

Consumer Behavior

Demand is driven by industrial requirements for bleaching and chemical processing agents.

Geopolitical Risks

Exposure to competition from global players in the inorganic chemicals industry.

⚖️ Regulatory & Governance

Industry Regulations

Compliance with Ind AS 115 for revenue recognition and Ind AS 108 for segment reporting. Subject to safety and maintenance standards for chemical factories.