Lotus Chocolate Q3 FY26 profit plunges 96% as costs rise despite revenue growth
Reliance-backed Lotus Chocolate reports sharp profit decline in Q3 FY26 amid higher expenses and business model transition.
INDIA – Lotus Chocolate Company, a subsidiary of Reliance Consumer Products Ltd (RCPL), has reported a steep 96.22% year-on-year decline in standalone net profit for the third quarter of fiscal year 2026, highlighting continued margin pressure despite revenue growth.
The company’s net profit fell sharply from Rs 3.71 crore (approximately US$0.45 million) in Q3 FY25 to Rs 0.14 crore (US$0.02 million) in Q3 FY26. Profit before tax declined by 85.90% to Rs 12.52 crore (US$1.51 million), compared with Rs 33.69 crore (US$4.06 million) recorded in the corresponding quarter last year.
Revenue from operations increased by 18.90% year on year to Rs 133.63 crore (US$16.10 million) in Q3 FY26, compared with Rs 112.37 crore (US$13.54 million) in Q3 FY25. However, net turnover for the quarter stood at Rs 134 crore (US$16.14 million), down from Rs 147 crore (US$17.71 million) a year earlier.
Total expenses rose 4.35% to Rs 149.67 crore (US$18.03 million) from Rs 143.43 crore (US$17.28 million) in Q3 FY25. The cost of material consumed declined sharply by 88.62% to Rs 19.71 crore (US$2.38 million), while employee benefit expenses surged 82.36% to Rs 8.52 crore (US$1.03 million). Finance costs nearly doubled, rising 97.64% year on year to Rs 4.19 crore (US$0.50 million).
Earnings before interest, tax, depreciation and amortisation (EBITDA) stood at Rs 15.67 crore (US$1.89 million) in Q3 FY26. The EBITDA margin improved slightly to 4.0%, compared with 3.8% in the year-ago quarter. Gross margins eased marginally to 9.31% from 9.78% in Q3 FY25.
Commenting on the results, Whole-time Director Natarajan M. Venkataraman said, “The company is poised to transition from a commodity-led model to a consumer-led growth engine. In pursuance of this transition, the company is also undertaking a structured review of existing B2B customer contracts to ensure alignment with the evolving consumer-led and integrated business model.”
Lotus Chocolate manufactures chocolates, cocoa products and cocoa derivatives for customers ranging from local bakeries to multinational companies. RCPL acquired a 51% stake in the company in May 2023.
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