Pharma stock tumbles 8% after CEO is remanded over fire accident at its Hyderabad plant

SYNOPSIS: Sigachi Industries Ltd announced its MD & CEO was remanded in a probe linked to the fire accident at its Pashamylaram facility, while operations continue normally under Deputy Group CEO Lijo Stephen Chacko.

During Monday’s trading session, shares of one of the leading global manufacturer of pharmaceutical excipients and active pharmaceutical ingredients (APIs) slumped nearly 8 percent on BSE, after its Managing Director & CEO was remanded in a probe into the Hyderabad unit fire.

At 11:02 a.m., shares of Sigachi Industries Limited were trading in the red at Rs. 32.08 on BSE, down by around 6 percent, compared to its previous closing price of Rs. 33.96, with a market cap of Rs. 1,226 crores. The stock has delivered negative returns of nearly 36 percent in one year, and has fallen by over 13 percent in the last one month.

What’s the News:

According to the latest disclosures filed with the stock exchanges, Sigachi Industries Limited informed that its Managing Director & CEO, Mr. Amit Raj Sinha, was remanded on 27th December 2025 in connection with the ongoing investigation into the fire incident at the company’s Hyderabad Unit located at Pashamylaram.

The company clarified that it has put in place all necessary measures to ensure uninterrupted business operations and smooth day-to-day functioning. During this interim period, Mr. Lijo Stephen Chacko, Deputy Group CEO, has been entrusted with overseeing the company’s operations.

The fire at the Pashamylaram facility on 30th June triggered an official investigation to examine the circumstances surrounding the incident. To ensure business continuity, production was reallocated to other operational units, with facilities at Dahej and Jhagadia continuing their operations without any disruption. The company stated that future decisions regarding the Pashamylaram unit will be based on the detailed findings of the ongoing government investigation.

As part of its recovery and support measures, the company had extended interim compensation and ex-gratia financial assistance to the families of affected employees and to those injured in the incident. In addition, it has strengthened its safety framework by conducting an enhanced dust hazard analysis aligned with NFPA 660 standards and upgrading pressure venting systems with rupture discs and interlock mechanisms.

Financials & More:

Sigachi Industries reported a decline in revenue from operations, experiencing a year-on-year decrease of around 12 percent, from Rs. 125 crores in Q2 FY25 to Rs. 110 crores in Q2 FY26. Likewise, its net profit decreased during the same period from Rs. 21 crores to Rs. 11 crores, representing a marginal fall of nearly 48 percent YoY.

In Q2 FY26, the company’s revenue contribution was led by the MCC (Microcrystalline Cellulose) segment, accounting for 60 percent of total revenue. The API (Active Pharmaceutical Ingredients) segment contributed 17 percent, followed by Operations and Management (O&M) at 12 percent, and Allied Trades at 11 percent, reflecting a well-diversified business mix across core and emerging segments.

While talking about capex, in FY21, the company incurred a modest capex of Rs. 9.3 crores, which increased significantly to Rs. 24.3 crores in FY22. The investment peaked in FY23 at Rs. 100.7 crores, indicating a major phase of expansion and infrastructure development. Subsequently, capex remained elevated at Rs. 85.2 crores in FY24 and Rs. 43.3 crores in FY25.

For FY26 and FY27, the company has outlined its capex plans for ongoing and upcoming projects. It plans to invest around Rs. 100 crore to expand MCC capacity by 12,000 metric tonnes at the Dahej SEZ facility. Once fully operational – expected by Q3 FY27 – the expansion is projected to generate approximately Rs. 250 crore in annual revenue.

Additionally, the CCS project will require an additional investment of about Rs. 60 crore, supplemented by Rs. 33 crore already available. While the entire expenditure may not be incurred by the end of the current fiscal year, the company confirmed that implementation is actively underway, with all finalised projects progressing as per schedule.

Sigachi Industries Limited emerged as one of the leading Microcrystalline Cellulose (MCC) manufacturers worldwide. It has a diverse portfolio comprising high-quality excipients, co-processed excipients, pre-formulated excipients, APIs and Intermediates, vitamin-mineral-nutrient blends and O&M services. The company operates 5 advanced manufacturing facilities spread across Gujarat, Telangana, and Karnataka.

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