Water waste management stock falls 10% after reporting 59% YoY decrease in net profit

Synopsis: Ion Exchange shares plunged over 10% today after the company’s Q3 profit plunged 59% YoY to Rs 20.6 crore despite revenue growing by 6.4% to Rs 734 crore, but that offered little relief as EBITDA fell 21% to Rs 59 crore, and margins continued to shrink. 

The shares of this water waste management stock, engaged in a wide range of solutions across the water cycle from pre-treatment to process water treatment, waste water treatment, recycling, zero liquid discharge, etc., are in focus after it reported poor financial results for this quarter. In this article, we will dive more into the details of it.

With a market capitalisation of Rs 5,147 crore, the shares of Ion Exchange (India) Ltd reached a day-low of Rs 322.10 per share, down 10.4 percent from its previous day’s closing price of Rs 359.45 per share. Over the past five years, the stock has delivered a robust 230 percent return, outperforming NIFTY 50’s return of 86 percent.

Q3 Highlights

The revenue from operations for Ion Exchange stands at Rs 734.44 crores in Q3 FY26 compared to Q3 FY25 revenue of Rs 690.51 crores, up by 6.4 per cent YoY. Additionally, on a QoQ basis, it reported a slight growth of 0.07 percent from Rs 733.94 crore. 

Also, EBITDA stood at Rs 59 crore in Q3 FY26, a sharp decline of 21 percent as compared to Rs 75 crore in Q3 FY25. Additionally, on a QoQ basis, it reported a decline of 13 percent from Rs 68 crore. Also, coming to the margins front, EBITDA margins declined by a staggering 300 bps YoY and by 100 bps QoQ, reaching 8 percent in Q3 FY26.

Coming down to its profitability, the company’s net profit stood at Rs 20.56 crore in Q3 FY26, a sharp decline of 59 percent as compared to Rs 49.59 crore in Q3 FY25. Also, on a QoQ basis, it reported a decline of 59 percent from Rs 49.92 crore. The company’s profit mainly took a hit as expenses grew faster than its sales, which directly took a toll on its profitability.

Segments

Coming to its sales mix, the company obtains the majority of its revenue from the engineering segment, which reported Rs 429.74 crore and has declined by 0.09 percent in Q3 FY26 from Rs 430.11 crore. Its Chemicals segment reported Rs 230.71 crore and has grown by 16 percent in Q3 FY26 from Rs 199.34 crore.

The remaining revenue is sourced from its Consumer Products segment, which reported Rs 98.68 crore and has grown by a staggering 28 percent in Q3 FY26 from Rs 77.16 crore. 

ION Exchange offers integrated water and wastewater treatment solutions comprising chemicals, resins, and high-tech equipment to treat and recycle water. The company’s zero liquid discharge and industrial recycling water systems assist companies in cutting down on the use of fresh water as regulations tighten. 

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