Shares of Jain Resource Recycling crashed nearly 16% in Tuesday's trade, extending their two-day decline to around 28% as investors reacted sharply to margin pressure in the March quarter despite strong revenue growth. According to reports from Moneycontrol, the stock fell 15.78% or ₹73.15 to ₹390.30 on the NSE at 10:59 am. The sharp decline reflects investor concerns over profitability challenges despite the company's robust revenue performance.
Jain Resource Recycling reported consolidated revenue from operations of ₹3,100 crore in Q4FY26, representing a 76% increase from ₹1,760 crore in the corresponding quarter last year. As reported by Moneycontrol, net profit rose 15% year-on-year to ₹60.4 crore from ₹52.4 crore, while profit before tax increased to ₹89.9 crore against ₹76.2 crore in Q4FY25. However, sequential performance showed weakness with revenue increasing 13% from ₹2,752 crore in Q3FY26, but net profit declining 52% from ₹125.6 crore amid rising operating costs and finance expenses.
For the full financial year FY26, consolidated revenue from operations climbed 48% to ₹9,543 crore from ₹6,429 crore in FY25. According to Moneycontrol, annual net profit surged 58% to ₹347.4 crore compared with ₹220.9 crore in the previous financial year. The company attributed growth during the quarter to higher business volumes across aluminium alloys, lead alloy ingots and copper recycling operations, with aluminium and aluminium alloys remaining the largest contributors to revenue during FY26.
The company faced significant margin pressure during Q4FY26 due to multiple factors including copper price volatility, constrained scrap availability and disruptions linked to the West Asia crisis. As reported by Moneycontrol, Motilal Oswal Financial Services noted that growth was driven by higher business volumes across aluminium alloys, lead alloy ingots and copper recycling operations, with copper and lead businesses showing 2.5x and 26% growth respectively. The brokerage expects gradual recovery in profitability as copper realisation formulas transition toward longer-term 'green formula' contracts showing signs of normalisation in Q1 FY27 negotiations.
Despite the margin pressures, Motilal Oswal Financial Services maintained its 'Buy' rating on the stock with a target price of ₹560, premised on 27x FY28E EPS. According to Moneycontrol, the brokerage lowered its FY27 and FY28 earnings estimates by 15% and 16% respectively, factoring in lower-than-estimated earnings in Q4. The company also announced plans to establish a new plastic recycling facility with a capital expenditure of ₹15 crore, which is expected to become operational by Q3FY27.
