JG Chemicals, a prominent name in zinc chemicals, made headlines today with the Board's approval for a major expansion project at Dahej, Gujarat, and the release of its Q1 FY26 financial results. The company's aggressive push into Western India marks a strategic chapter, complemented by solid operational performance and profit growth for the quarter ending June 30, 2025.
Key Highlights
Dahej Expansion Project: Strategic Growth in Western India
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JG Chemicals will invest Rs.100 crore from internal accruals to expand its zinc chemicals manufacturing at Dahej, Gujarat.
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This site, covering 11.43 acres in the Dahej Petroleum, Chemicals and Petrochemicals Investment Region (PCPIR), positions the company closer to key markets and enhances its geographical diversification.
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The project targets an incremental capacity of 40,000MT per annum, adding to the existing 69,984MT capacity and greatly enriching the overall product mix. Production will include zinc oxides, zinc sulphates, and other high-performance zinc chemicals.
Scale & Timeline
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Phase 1 of the new capacity is slated to commence in the first half of FY27, bringing significant scale-up and improved reach in Western India markets.
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The expansion is forecasted to add INR900 crore to annual revenue upon achieving full utilization, aligning with robust industry demand projections.
Financing and Rationale
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The entire Rs.100 crore investment will be funded through internal accruals, ensuring prudent capital management.
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The expansion responds directly to rising customer demand, with management emphasizing an enriched product portfolio and competitive positioning.
Q1 FY26 Business Performance
Revenue and Profit Surge
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For the quarter ending June 30, 2025 (Q1 FY26), JG Chemicals reported consolidated revenue from operations of Rs.2.18 billion, showing healthy topline growth.
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The consolidated net profit reached Rs.157.7 million, demonstrating resilience in core margins as the company capitalized on strong demand and operational excellence in key segments.
Product & Customer Highlights
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The company continues to serve over 200 domestic and 50 global clients across more than 10 countries, remaining a key supplier to the rubber, tyre, ceramics, paints, coatings, and specialty chemicals sectors.
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Revenue growth benefited particularly from strong volumes in tyres and zinc sulphates, bolstered by favorable monsoons and demand across end-industries.
Operational Efficiency
Management focused on cost optimization and efficiency, further supporting margin improvement initiatives across manufacturing units.
Other Important Aspects
Recent Land Acquisition in Dahej
In May 2025, JG Chemicals purchased land at Dahej PCPIR for Rs.24.05 crore (excluding taxes), forming the foundation for the approved expansion. The move underlines the company's commitment to sustainable recycling and product diversification in zinc chemicals.
Market Positioning
JG Chemicals is recognized as one of the ten largest zinc oxide suppliers globally, employing advanced French process technology and leading in customer-driven customization.
Outlook
The Dahej expansion signals sustained investments for long-term value creation and strategic capacity additions, with Western India set to become a major growth engine as new capacities come online in FY27.
Source: Reuters, TradingView, Economic Times, Indian Chemical News, EquityBulls, ChemIndigest, Moneycontrol, Screener, TipRanks.
