Century Plyboards reported a powerful operational efficiency for the December quarter (Q3FY26), underpinned by double-digit income progress throughout segments and a pointy enchancment in profitability.
Consolidated web revenue rose 9.4% year-on-year to ₹64 crore, whereas income climbed 18.4% to ₹1,350 crore. EBITDA jumped 32% to ₹170.5 crore, lifting working margins to 12.6% from 11.3% a 12 months in the past.
Chatting with CNBC-TV18, Govt Director Keshav Bhajanka mentioned the efficiency was significantly notable given the difficult demand backdrop for constructing materials firms.
“Throughout the board, we’ve got seen a really sturdy efficiency in a muted demand surroundings. General, we’re taking a look at near 18% plus income progress, and this has been broad-based fairly than pushed by anyone phase,” Bhajanka mentioned.
Broad-based progress regardless of muted demand
Century Plyboards’ core plywood enterprise posted 15% income progress throughout the interval, whereas laminates grew near 10%. MDF revenues rose round 20%, and the particle board phase noticed an 80% bounce, aided by a low base and new capability additions.
Bhajanka mentioned the corporate is effectively on observe to satisfy the income steerage it had outlined firstly of the 12 months. Whereas plywood revenues are more likely to exceed preliminary expectations, laminate progress could are available in barely decrease. MDF and particle board companies, nonetheless, are monitoring according to projections.
“In a tough demand state of affairs, this has been a commendable efficiency,” he added.
Housing stock delays weigh on demand
Explaining the demand headwinds, Bhajanka mentioned Century Plyboards’ merchandise are consumed on the again finish of the housing cycle, when houses are accomplished and occupied, fairly than throughout the development section.
“Our merchandise go into consumption when a home turns into a house. New launches that happened post-COVID had been speculated to hit the market earlier, however on account of a number of causes, that stock has been delayed. This has impacted demand for constructing materials merchandise,” he mentioned.
Nonetheless, administration expects this to show right into a tailwind over the following few years as delayed housing stock lastly involves market.
“With these new launches now hitting the market, we’re very hopeful of seeing strong progress over the following couple of years,” Bhajanka mentioned.
FY26 steerage reiterated
Regardless of the near-term challenges, Century Plyboards has reiterated its segment-wise progress steerage for FY26. The corporate expects plywood revenues to develop 13% or extra, laminates 15% plus, MDF 25% plus, and particle board 40% plus within the coming 12 months.
Bhajanka confirmed that the corporate is sticking to those targets, indicating confidence in each demand restoration and execution.
Margin outlook supported by uncooked materials stability
On margins, the administration mentioned uncooked materials costs have largely stabilised after peaking earlier. Timber and resin costs stay regular total, offering consolation on profitability.
“There may be large-scale stability in timber costs and uncooked supplies equivalent to resins. Whereas there have been some pockets of challenges — like timber shortages in Punjab on account of floods — on the entire, costs have stabilised, which can assist us obtain our present margins,” Bhajanka mentioned.
With working leverage bettering and uncooked materials inflation below management, Century Plyboards expects margins to stay resilient even because it steps up progress throughout segments.
For buyers, the important thing takeaway is obvious: whereas demand circumstances stay difficult within the close to time period, Century Plyboards is positioning itself to profit as housing completions translate into consumption, with steerage intact and profitability on a firmer footing.
Additionally Learn | Century Plyboards Q3 Outcomes: Web revenue rises 9%, margin at 12.6%
Under is the verbatim transcript of the interview.
Q: Let’s begin by speaking about your steerage for FY25–FY26. No matter you had focused looks as if you’re attaining it. There may be nothing to complain about on that entrance. The plywood phase has seen 13% progress, and you’re managing to see good progress even this time as effectively, of greater than 14–15% round that degree. Margins there are additionally doing effectively. What’s the outlook now, segment-wise and total, that you’ve got saved for your self as an inner goal for FY27?
Bhajanka: I believe throughout the board we’ve got seen a really sturdy efficiency in a muted demand surroundings. General, we’re taking a look at near 18% plus income progress. The nice half is that this has been broad-based and never pushed by any explicit phase. Our plywood phase has grown by 15% in income. The laminate phase has grown by near 10%. The MDF phase has grown by shut to twenty%, and particle board, in fact, on a low base and with the brand new capability addition, has grown by near 80%. I believe for the present 12 months, we’re effectively on observe to attain the income steerage that we’ve got given. For plywood, income steerage is more likely to be somewhat greater than what we had envisaged firstly of the 12 months, however in laminates it might be barely decrease. For MDF and particle board, we’re effectively on observe to satisfy our income projections. So, in a tough demand state of affairs, this has been a commendable efficiency.
Q: I needed to the touch base and broaden somewhat on the demand state of affairs, which you’ve known as difficult twice now in a single reply. Individually, I additionally needed to ask you to reiterate your steerage for FY26. You probably did contact upon plywood, however if you happen to might reiterate the steerage you’re offering.
Bhajanka: In plywood, we will probably be at 13% plus when it comes to income progress. In laminates, we will probably be at 15% plus. In MDF, 25% plus, and in particle board, we will probably be at 40% plus for the approaching 12 months.
Q: Okay, so that you’re sticking with that.
Bhajanka: Sure.
Q: For those who might now give us a way of what the demand state of affairs is wanting like. You mentioned it’s difficult. What sort of challenges did you face this quarter, and what are you anticipating for FY27? Do you assume that would probably be a headwind in your steerage?
Bhajanka: I believe for the present 12 months, as I’ve already talked about, we’re effectively on observe with regard to our steerage numbers. Having mentioned that, the problem is mainly that our merchandise go into consumption when a home turns into a house—when the top buyer begins shopping for the product. Our merchandise are consumed not a lot when the constructing is being made or when the construction is being created, however in the direction of the again finish of the cycle. As soon as new stock hits the market, that’s when demand for our merchandise begins selecting up. The brand new launches that happened post-COVID had been speculated to hit the market somewhat earlier. Nonetheless, on account of quite a lot of causes, that stock hitting the market has been barely delayed, which has impacted the general demand for constructing materials merchandise. However we’re very hopeful that now, with these new launches lastly hitting the market, we should always see strong progress over the following couple of years.
Q: What in regards to the costs of timber and chemical substances? How have they moved? Have they elevated? Is there any concern on that entrance for margins, and what can be your margin steerage?
Bhajanka: I believe there may be large-scale stability when it comes to timber costs and costs of uncooked supplies equivalent to resins. Nonetheless, sure pockets do face challenges. For example, in MDF at our Punjab plant within the north, we confronted an acute scarcity of timber on account of flooding in September and October, which is well-known. Nonetheless, on the entire, costs have peaked and there may be now stability in long-term costs, which can assist us obtain our present margins.
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