Himadri Speciality Chemical Ltd. makes a corporate announcement

The initial commercial LFP cathode active-material capacity is 2,000 MTPA, but the cited disclosures describe this as the first milestone targeted for commissioning by Q3 FY27—not as the full Phase I plant already operating. Phase I is planned at 40,000 MTPA, with the longer-term ambition at 200,000 MTPA. ^[1]

This is consistent with the previously disclosed battery-materials capex plan:

• Capacity: 2,000 MTPA initial module, equal to 5% of the 40,000 MTPA Phase I capacity (derived from the disclosed capacities). ^[1]
• Phase I capex: approximately Rs 1,130 Crores for the 40,000 MTPA LFP cathode plant, as subsequently reiterated in the results-update coverage. ^[2]
• Scale-up: the balance Phase I capacity is to be commissioned progressively, with full operations envisaged by FY29. ^[1]

Analytical read: the 2,000 MTPA facility should be viewed as the qualification and commercial-entry module within the existing Phase I capex envelope, not as a revision to the announced project size or capex. The sources do not establish that 5% of capacity equates to 5% of capex; commissioning cost will depend on the sequencing of common infrastructure and downstream expansion. Also, the latest investor-presentation extract specifies the capacity milestones but does not itself quantify the LFP capex; the approximately Rs 1,130 Crores figure is the later reiterated capex disclosure.

HSCL’s latest reported leverage remains materially more conservative than during the earlier expansion cycle, despite the recent capex build. Consolidated gross debt-to-equity was 0.16x in Q1 FY27, with net debt-to-equity at 0.13x ^{[3] [4]}. Interest coverage was 15.36x ^[5].

What changed with the capex cycle

• The current 0.16x gross debt-to-equity is approximately 57% below the FY21-FY23 peak range of 0.37-0.38x, while net debt-to-equity is also well below the earlier peak of 0.35x. This indicates that the battery-materials investment has not recreated the balance-sheet leverage seen in the previous capacity-building phase.
• Absolute debt has nevertheless increased: consolidated total debt rose from Rs 308.71 Crores in FY25 to Rs 766.56 Crores in FY26, while net debt increased from Rs 153.60 Crores to Rs 601.80 Crores ^{[6] [7]}. The capex build is visible in consolidated capital work in progress, which increased from Rs 185.25 Crores in FY25 to Rs 372.18 Crores in FY26 ^[8].
• Interest coverage has moderated from the FY25 peak of 19.01x to 15.36x, but remains nearly three times the FY23 level and more than six times the FY22 trough. The deterioration is therefore a normalization from an unusually strong balance-sheet position, not a return to the tighter debt-servicing conditions of the earlier expansion cycle.
• The battery program is still ahead of its full earnings contribution: the 200 MTPA anode facility was commissioned in April 2026 ^[9], while the first 40,000 MTPA LFP phase was scheduled for operationalisation by Q3 FY27 ^[10]. Current coverage therefore reflects the existing business carrying the financing burden before the full battery-materials ramp-up.

Important timing caveat: HSCL issued Rs 150 Crores of unsecured commercial paper on 9 July 2026 at 6.60% for 90 days ^[11]. That issuance occurred after the 30 June 2026 Q1 reporting date, so it is not reflected in the reported 0.16x debt-to-equity or 15.36x interest-coverage ratios. A post-issuance ratio cannot be quantified without a subsequent balance sheet, but the CP represents a modest additional short-term leverage step.