Earnings Outlook
Low input cost, volumes to drive Pidilite Jan-Mar earnings
This story was originally published at 17:17 IST on 3 May 2025
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By Narayana Krishna
HYDERABAD - Despite subdued demand, Pidilite Industries Ltd. is expected to deliver healthy earnings growth for the March quarter, driven by lower base and falling raw material costs, according to analysts.
The Mumbai-based adhesives maker is expected to report a 49% on-year rise in its Jan-Mar consolidated net profit to INR 4.5 billion, according to an average of estimates from five brokerages. Analysts' estimates for Pidilite's Jan–Mar net profit range from INR 4.28 billion by ICICI Securities Ltd., to INR 4.79 billion by Nuvama Wealth Management Ltd. Along with a lower profit base, volume growth is also expected to support higher on-year numbers.
The company's revenue for the quarter is seen growing 9% on year to INR 31.6 billion, according to the estimates. Revenue projections range from a low of INR 31.07 billion by Nuvama Wealth to a high of INR 31.96 billion by Kotak Institutional Equities.
In the March quarter last year, Pidilite had reported a net profit of INR 3 billion on revenue of INR 29 billion. The company is scheduled to announce its Jan–Mar earnings on Thursday.
ICICI Securities expects Pidilite's revenue to grow 9.8% on year, with operating margins seen improving by 17 basis points due to lower raw material costs. Kotak Institutional sees a 10% on-year growth in revenue, led by a 7% rise in the consumer and bazaar segment and a 17% increase in the business-to-business segment.
Analysts expect a soft quarter, excluding the base effect, primarily due to weak demand, particularly in urban markets.
"We expect demand softness to continue in 4Q (Jan-Mar), though rural growth continues to outperform urban growth. Pidilite's core category remains under pressure due to the subdued demand environment," Motilal Oswal Financial Services Ltd. said in its pre-earnings note.
Sequentially, Pidilite's net profit is seen declining 19% and revenue is projected to fall 6%, according to the estimates. For Oct-Dec, Pidilite had reported a net profit of INR 5.52 billion on revenue of INR 33.69 billion.
Nuvama Wealth forecasts Pidilite's March quarter earnings before interest, tax, depreciation and amortisation margins to expand 220 bps to 22.1%, driven by a decline in raw material costs, especially those used in value-added products. The average of estimates from five brokerages pegs Pidilite's Jan-Mar EBITDA at INR 6.48 billion.
On Friday, shares of Pidilite Industries closed 0.8% down at INR 3,008.70 on the National Stock Exchange. Pidilite has gained 5.1% in the past 30 days and 3.6% so far in 2025.
Following are the Jan-Mar earnings estimates for Pidilite Industries Ltd., based on reports from 5 brokerage firms in the descending order by the estimate of net profit:
Brokerage name | Net sales | Net profit | EBITDA |
--in million rupees-- | |||
Nuvama Wealth Management Ltd | 31,073.00 | 4,785.00 | 6,867.00 |
Prabhudas Lilladher Pvt Ltd | 31,763.00 | 4,561.00 | 6,469.00 |
Motilal Oswal Financial Services Ltd | 31,392.00 | 4,369.00 | 6,310.00 |
Kotak Institutional Equities | 31,955.00 | 4,346.00 | 6,372.00 |
ICICI Securities Ltd | 31,869.00 | 4,275.00 | 6,390.00 |
Average | 31,610.40 | 4,467.20 | 6,481.60 |
End
Edited by Subhojit Sarkar
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