Jindal Group stock falls 5% after SEBI reported disclosure issues on losses worth ₹760 Cr

Synopsis:
Jindal Poly Films plunged sharply from the day’s high after SEBI flagged multiple irregularities in one of its group companies that caused a loss of Rs 760 crore, which was not disclosed in a proper way to its shareholders.

The shares of this leading manufacturer of BOPET and BOPP films in India are in focus after SEBI flagged multiple irregularities to NCLT regarding one of the company’s investments in its group entity. In this article, we will dive more into the details.

With a market capitalisation of Rs 2,277 crore, the shares of Jindal Poly Films Ltd are currently trading at Rs 521 per share, down 5 percent from its day’s high of Rs 546.25 per share. Over the past five years, the stock has delivered a poor return of only 10 percent, underperforming NIFTY 50’s return of 102 percent.

Reason Behind the Fall

Jindal Poly Films came under pressure after SEBI informed the National Company Law Tribunal (NCLT) about preliminary findings from an ongoing investigation into the company’s past investment decisions. 

As per SEBI, the company invested in a group entity, Jindal India Powertech, and then wrote off these investments, thereby making a loss of nearly Rs 760 crore. The regulator alleged that these write-offs of accounts were not disclosed to the shareholders in a transparent manner, which caused concerns regarding governance and reporting practices.

SEBI also pointed out that the disinvestments from the company were spread over several financial years, so that the losses in any single period would not be visible. This, according to the regulator, masked the significant impact on the company’s finances and shareholder value. Moreover, SEBI argued that the stock price of Jindal Poly Films did not represent the full extent of value destruction caused by these deals, thereby adding investor anxiety.

Share price sentiment turned bearish with SEBI moving the NCLT and indicating further action besides the minority shareholders’ class action suit already filed. Jindal Poly Films fell nearly 5 percent in today’s trading session from days’ high due to the selling pressure caused by the heightened scrutiny and governance ​‍​‌‍​‍‌​‍​‌‍​‍‌concerns.

Q2 Highlights

Jindal Poly Films Ltd reported a core revenue of Rs 1,083 crore in Q1 FY26, a decline of 12 percent as compared to Rs 1,233 crore in Q1 FY25. Additionally, it declined by 24 percent from Rs 1,420 crore in Q4 FY25. 

Regarding its profitability, it reported a net profit of Rs 37 crore in Q1 FY26, a sharp decline of 78 percent as compared to Rs 168 crore in Q1 FY25. However, it recorded a sharp turnaround as compared to a loss of Rs 179 crore in Q4 FY25.

Jindal​‍​‌‍​‍‌​‍​‌‍​‍‌ Poly Films ranks among the top packaging material manufacturers in India, with an extensive portfolio of films for packets, labels, and industrial applications. The firm is making BOPP and BOPET films, which are the standard materials in food packaging, consumer goods, and laminate industries. Besides, it also manufactures coated and metallised films of a specialised nature.

In addition to packaging films, Jindal Poly has ventured into non-woven fabrics that find use in hygiene products and other industrial areas. The company, with its footprint in the Indian and international markets, is supplying the large FMCG, pharma, and packaging brands and thus, becoming a dominant player in the flexible packaging ​‍​‌‍​‍‌​‍​‌‍​‍‌industry.

Written by Satyajeet Mukherjee

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