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Informist, Wednesday, Aug. 12, 2026

 

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--Astral: Expects UK ops to surpass double-digit sales guidance by year end 
--CONTEXT: Comments from Astral mgmt in post-earnings analyst call
--Astral: Hopes to achieve double-digit revenue growth guidance in FY27
--Astral: Sees demand recovery in Jul-Aug, dealers in rush to fill stocks 
--Astral: Estimates margins in 16-18% range on polymer price volatility 
--Astral: May change margins guidance in Sept quarter, unsure of direction 
--Astral: Raw material prices up 15-16%, took 6-8% price hikes across board
--Astral: Kanpur plant capacity fully utilised, may expand next year
--Astral: Hyderabad unit operating at 50%, gaining traction in local market
--Astral: Spent INR 1.37 bln as capex in Q1 of planned INR 3.5 bln for FY27 
 

 

By Sunil Raghu and Adhithya Aji
 
AHMEDABAD/MUMBAI – Astral Ltd.'s senior officials Wednesday said they continue to maintain their earlier guidance of achieving double-digit revenue growth in 2026-27 (Apr-Mar). The company had earlier guided for 20-25% revenue growth in FY27.

 

On Wednesday, the officials said they expect the earnings before interest, tax, depreciation, and amortisation margin for the company in the 16-18% range for the current financial year. "I think product mix has not changed much because we are more focused company on the plumbing side of the business… And that is why you see that the margins are also pretty stable. Normally, within the 16 to 18%, we deliver this time a little more," a company official told analysts. He also said that while the management sees the EBITDA margin growth moving upwards, it is not completely sure of the direction at present, adding that it may revise the EBITDA margin guidance in the September quarter.

 

The officials also said volumes would grow in double digit, with paints likely to achieve top line growth of 20-25% on year and EBITDA margin growth of low single digit. For adhesives, the management guided for 15% growth in EBITDA margins. For the company's UK operations, the officials guided for 8-10?ITDA margin growth in FY27.  

 

The margin outlook reflects the current volatility in costs of key input materials such as polymers, primarily poly vinyl chloride, company officials told analysts in a conference call held post the June quarter earnings on Wednesday. While raw material costs went up 15-16%, the company has taken a price hike of 6-8?ross the board.

 

With PVC prices going up, the company is hopeful that dealers would again fill up their inventory. The officials said if this kind of scenario continued for long, their probability of raising the margin guidance from 16-18% might increase.
 
For the June quarter, the company's revenue from the plumbing business rose over 10% on year to INR 10.51 billion. Plumbing sales volume rose 0.1% on year to 56,146 tonnes, while the segment's EBITDA increased over 26% on year to INR 1.98 billion. EBITDA margin for the plumbing segment expanded to 18.9% from 16.4%. The company has increased its pipes and fittings production capacity to 421,497 tonnes at the end of the June quarter from 417,645 tonnes earlier.
 
The company officials said that with their Kanpur plant operating at nearly full utilisation levels, they may look to expand the production capacity of this plant next year. On one of the latest additions to Astral's stable, the officials said their Hyderabad plant was operating at 50% and they were getting good traction from the local market. 

 

In their earnings call post the March quarter, Astral officials had stated that they would bring down capital expenditure to INR 3 billion in FY27 from INR 3.6 billion in FY26. On Wednesday, they maintained that the capex would be in INR 3 billion-INR 3.5 billion. The management said it incurred INR 1.37 billion in capital expenditure during the first quarter, including INR 870 million on plumbing capacity expansion.

The pipes and adhesives maker's consolidated net profit for the June quarter jumped nearly 48% on year to INR 1.2 billion, exactly in line with analysts' estimate. The company's consolidated revenue for the quarter rose nearly 16% on year to INR 15.78 billion, a tad lower than analysts' expectation of INR 15.94 billion.

 

On Wednesday, the company's shares ended at INR 1,464 on the National Stock Exchange, up 2.7% from the previous close. The company announced its June quarter earnings after market hours.  End

 

Edited by Avishek Dutta

 

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