Why did Gandhar Oil shares crash 9% despite 70% YoY jump in profits?

SYNOPSIS: Gandhar Oil Refinery reported steady Q3 FY26 revenue growth with strong YoY profit and EBITDA gains, despite sequential profit decline, while announcing an interim dividend, and approved land acquisition and asset sale.

Shares of a leading manufacturer of white oils by revenue, engaged in producing pharmaceutical, health care, and performance oil (PHPO), process insulating oil (PIO) and lubricants crashed 9 percent on Tuesday, despite posting Q3 FY26 results marked by a sharp growth of around 70 percent YoY in net profit.

At 11:28 a.m., shares of Gandhar Oil Refinery (India) Limited were trading in red at Rs. 154.2 on BSE, down by around 6 percent, compared to its previous closing price of Rs. 163.9, with a market cap of Rs. 1,509.3 crores. The stock has delivered negative returns of over 13 percent in the last one year, but has gained by percent in the last one month.

Financial Performance for Q3 FY26

Gandhar Oil Refinery (India) Limited announced the financial results for the third quarter of FY26 on Friday after market hours, as per the latest regulatory filings with the stock exchanges.

For the quarter, the company posted a consolidated revenue from operations of Rs. 1,167 crores, reflecting a sequential growth of around 10 percent QoQ compared to Rs. 1,060 crores in Q2 FY26. Likewise, on a year-on-year basis, revenue grew over 16 percent from Rs. 1,005 crores recorded in Q3 FY25.

Net profit for Q3 FY26 stood at Rs. 34 crore, indicating a decrease of around 15 percent QoQ from Rs. 40 crores in Q2 FY26, but a year-on-year growth by around 70 percent from Rs. 20 crores reported in Q3 FY25.

Operating performance improved significantly during the quarter, with consolidated EBITDA rising sharply by about 42 percent YoY to Rs. 59 crore from Rs. 41.6 crore in Q3 FY25, but declining by over 10 percent QoQ from Rs. 65.8 crores in Q2 FY26.

The sequential decline in net profit and EBITDA may have weighed on investor sentiment, potentially contributing to the stock’s decline during today’s trading session.

For 9MFY26, the company’s consolidated revenue mix was led by PHPO, which contributed 50 percent, followed by lubricants at 26.8 percent, channel partners at 13.7 percent and PIO at 9.5 percent. During the same period, revenue stood at Rs. 3,130 crore and EBITDA amounted to Rs. 171 crore, backed by manufacturing sales volumes of 4,09,974 KL, up by 10 percent over last year.

Board Approvals & More

The company’s Board declared an interim dividend of Rs. 0.75 per equity share, representing 37.5 percent of the face value of Rs. 2 per share, for FY26. The record date for determining shareholder eligibility for the interim dividend has been fixed as 30th January 2026.

The Board also approved the purchase of a land parcel measuring 453.55 decimals adjacent to the company’s existing factory. The acquisition aligns with the company’s long-term expansion plans and is expected to strengthen its operational capabilities. Additionally, the Board approved the sale of its immovable property located at Village Kailon, Mohali, in the district of Sahibzada Ajit Singh Nagar, Punjab.

Gandhar Oil Refinery (India) Limited is principally engaged in three segments: (i) manufacturing and trading of petroleum products/specialty oils; (ii) trading of non-coking coal; and (iii) providing consignment/del-credere agency services for the sale of polymers to local markets. Its manufacturing facilities are located at MIDC Taloja, Maharashtra and Silvassa (U.T.), along with branch offices and various depots across the country.

The company is one of India’s leading players in the white oil industry, commanding a 26.5 percent domestic market share, and ranks among the top 5 players globally with 9.6 percent market share of the global white oil market. Gandhar Oil manufactures a wide variety of specialty oils and lubricants such as white oils, waxes, jellies, automotive oils, industrial oils, transformer oils and rubber processing oils, marketed under its flagship brand, Divyol.

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