Q1 2027 Astral Limited Earnings Call Transcript
Key Points
- Astral Ltd (BOM:532830) delivered a 10% value growth in plumbing with an 18.9% EBITDA margin, one of the highest in the industry, despite a market de-growth of ~10%.
- The adhesive business in India posted robust growth of 24.9%, driven by strong rural and online sales, while the UK adhesive business rebounded with 26% growth and improving EBITDA margins.
- The paint business achieved a record 48.7% growth, reaching EBITDA breakeven, with strong performance across all six operating states.
- The newly acquired specialty chemical company (DSS) delivered an excellent EBITDA of 12.9% from the first quarter, contributing to value growth.
- The implementation of MIP (Minimum Import Price) on PVC is expected to reduce polymer price volatility, improving demand visibility and supporting margin stability.
- The polymer industry experienced high price volatility in Q1, leading to an industry de-growth of approximately 10%, which impacted overall demand.
- The adhesive business in India saw margins under pressure due to high inventory costs from previous quarters, with EBITDA margin declining to 12.2% from 14%.
- The plumbing business faced a flat volume growth in Q1, partly due to a 10-day shutdown for SAP HANA implementation, which disrupted dispatches.
- The paint business remains at EBITDA breakeven, with margins still low at 0.1%, indicating ongoing challenges in achieving profitability.
- The company has deferred the demerger of its chemical business, citing shareholder concerns and the need for a larger scale (INR 5,000-6,000 crore revenue) before reconsidering.
Ladies and gentlemen, good day and welcome to Astral Limited Q1 FY 2027 earnings conference call, hosted by Equirus Securities. (Operator Instructions) Please note that this conference is being recorded.
I now hand the conference over to Mr. Pranav Mehta from Equirus Securities. Thank you, and over to you, sir.
Yeah. Thank you, Palak. Good evening, everyone. Thank you for joining this call. Today from the management side, we have Mr. Sandeep Engineer, Chairman and Managing Director, Mr. Hiranand Savlani, ED and CFO, Mr. Kairav Engineer, Executive Director, and Mr. Saumya Engineer, CEO, Adhesives and Paint Division. I will now hand over the call to Sandeep, sir, for his opening remarks. Over to you, sir.
Thank you. I welcome you all for the earning call Q1 FY 2027. As you all are aware, the polymer industry is passing through a volatile time. Prices are highly volatile and
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