Castrol India profit drops 23 percent

During the July-September 2026 period, Castrol India reported a 22.6% drop in net profit to ₹176.37 crore, down from ₹227.80 crore in the same quarter last year. The company cited increasing raw material expenses and unfavorable currency fluctuations as key factors pressuring profitability, particularly before an upcoming shift in ownership structure.

Despite these challenges, operational revenue climbed 27.3% to ₹1,734.72 crore, up from ₹1,362.75 crore annually. However, earnings before interest, tax, depreciation, and amortization (EBITDA) decreased by 18.8% to ₹262.04 crore from ₹322.80 crore.

Operational Pressures

Saugata Basuray, the managing director, remarked that “in a quarter marked by a sharp rise in raw material costs and adverse currency movements, Castrol delivered a resilient performance.” He further explained that proactive pricing adjustments earlier in the fiscal year helped soften the impact on profit margins.

Mrinalini Srinivasan, the chief financial officer, indicated that market conditions would likely stay unstable and inflationary. She emphasized the company’s commitment to adapt quickly through strategic pricing and cost controls to handle margin pressures.

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Ownership Changes

The financial update coincides with BP’s plan to sell a 65% controlling stake in its global Castrol lubricants division to Stonepeak, valued at around $10 billion. This transaction would grant Stonepeak indirect influence over Castrol India, where UK-based Castrol Limited currently holds a 51% share.

The proposed ownership shift has triggered a mandatory open-offer process for Indian investors, with Stonepeak and its partners aiming to acquire up to 26% of Castrol India’s shares at ₹194.04 each. The company will maintain its public listing unless a separate delisting initiative is pursued, and its day-to-day functions will remain unchanged pending regulatory approvals.

Financial Overview

For the first nine months of 2026, net profit reached ₹766.25 crore, reflecting an 8.6% increase over ₹705.26 crore in the same period last year. Revenue advanced 20.3% to ₹5,151.43 crore from ₹4,281.58 crore, while EBITDA grew 11% to ₹1,086 crore.

Castrol’s industrial segment experienced double-digit volume growth, expanding its customer base by 700 across sectors like automotive, machinery, metals, aerospace, and sugar production. The company’s distribution network now covers approximately 1.67 lakh outlets, including 46,000 in rural areas.