Overview
Haycarb manufactures and exports coconut-shell activated carbon, with Puritas providing water and wastewater purification systems. Its procurement and production network spans several coconut-producing countries, while sales reach North America, Europe, Africa and Asia.
The most important change is the latest quarter's acceleration in revenue and operating profit, supported by stronger activity in the core carbon business and a disclosed expansion into energy-storage carbon.
Price performance
The shares closed at LKR 176 on 2026-08-13. They gained 22.6% over three months while the ASPI fell 6.0%, and rose 81.8% over one year against an 8.2% index gain.
Price sits at 95.5% of its 52-week range, only 2.2% below the high. Recent annualised volatility was 32.0%, 5.3 percentage points above its own one-year norm, while 20-day volume was 12.0% below its 60-day average. The share advanced despite no company article in the last 30 days.
Valuation
Haycarb trades at 14.45 times earnings and 1.69 times book value. The P/E is at the 68th manufacturing-sector percentile, whereas the P/B is at the 48th percentile, so the earnings multiple is the more demanding part of the valuation.
Return on equity was 12.3%, giving some support to the book valuation, while the 2.5% dividend yield sits at the 35th sector percentile. The payout direction is mixed: dividend per share declined from LKR 5.0 in FY2024 to LKR 3.8 in FY2025, then recovered to LKR 4.07 in FY2026; the FY2027 record is incomplete.
News and sentiment
Coverage was positive overall, with 7 positive and 2 neutral material articles in the 90-day window and no negative items. However, the last 30 days were unusually quiet, with no company articles against a baseline of 1.0 per month.
The main substantive development was the 2026-06-02 BOI agreement for an USD 18.18 million energy-storage carbon expansion, including a Philippines facility targeted for phase one by H1 2027. The latest confirmed dividend was LKR 0.75 per share, with an ex-date of 2026-07-09.
Financials
The June 2026 quarter delivered revenue of LKR 19.8 billion, up 44.7% year-on-year, while operating profit rose 138.0% to LKR 2.3 billion and net profit increased 83.1% to LKR 1.2 billion. Gross margin widened from 19.5% to 19.8%, operating margin from 7.0% to 11.5%, and net margin from 4.9% to 6.3%.
The improvement was meaningful but not yet a return to historical peak profitability. June gross margin ranked 6th of 7 comparable June quarters and net margin ranked 6th of 7, while operating margin was middling at 4th of 7. Finance costs, tax and other below-the-line items absorbed LKR 1.04 billion, up from LKR 281 million a year earlier, limiting the conversion of operating growth into net profit.
For the twelve months to 2026-06-30, revenue reached LKR 73.2 billion, up 26.9%, with operating and net margins of 10.4% and 6.7%. Owners' equity was LKR 30.9 billion versus LKR 27.5 billion a year earlier, while the share count was unchanged at 297.1 million. The March 2026 result reported in May was historical by the June filing and should not be treated as the latest operating picture.
Risks
The largest risk is financing and cash generation. At 2026-03-31, gearing was 62.1% of owners' equity and free cash flow was negative LKR 9.7 billion; annual cash conversion was -0.8 times, showing that reported operating profit did not arrive as operating cash.
Liquidity remained adequate but less comfortable, with a current ratio of 1.74, while interest cover was 7.02 times. Minority shareholders received 16.6% of group profit, so consolidated net profit and the earnings attributable to Haycarb shareholders are not the same pot of money.
The manufacturing sector also faces labour shortages, while July inflation reached 7.3% after a roughly 47% fuel-price increase. These conditions could pressure production costs, although falling domestic yields and a stronger rupee provide a more supportive financing and import-cost backdrop.
Outlook
The next defined event is the quarter ending 2026-09-30, which is expected to be filed between 2026-10-31 and 2027-01-26. As at 2026-08-13, that filing is the point at which the strong June-quarter growth record will be refreshed and the market can assess whether the expansion is accompanied by better cash generation and margins.
The BOI expansion and planned Philippines facility give the company a visible capacity-growth programme, but the available data cannot establish its eventual returns or funding requirements. The immediate picture therefore remains positive on growth and strategic investment, with execution and cash conversion the key constraints.