Pidlite expects double-digit volume growth in H2 with higher Ebitda

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Pidilite Industries expects a "double digit underlying volume growth' in the second half of the current fiscal, helped by its growth brand steps, along with product innovation and marketing initiatives, its Managing Director Sudhanshu Vats has said.

The company expects to continue the momentum in H2 with a higher Ebitda (earnings before interest, taxes, depreciation, and amortisation), as input costs remain benign, Vats said in a post-earnings virtual media roundtable.

"We see momentum to continue. Therefore, the underlying double-digit volume growth that we delivered in the first half, we want to continue with that momentum into the second half," said Vats while replying to a query from PTI.

The company, which manufactures adhesives, sealants and construction chemicals, had last week reported 9.8 per cent growth in its consolidated net sales to Rs 3,540 crore for the September quarter. Moreover, its Ebitda increased by 24 per cent.

The maker of Fevicol, M-Seal, Fevikwik, Dr Fixit, and Araldite had delivered double-digit underlying volume growth with sequential improvement and healthy operating margins, even in a challenging macro-economic environment.

It remains optimistic and expects improvement, aided by favourable monsoons and the indirect cascading impact of GST 2.0 on demand, coupled with accelerated growth in the construction sector, driven by benign interest rates and enhanced liquidity.

"In the first half, we have been on the higher side of the Ebitda corridor, which we've delivered, around 24 per cent, and I think if the input costs remain benign, we should deliver double-digit underlying volume growth profitably and perhaps within the corridor for sure, but maybe on more of the higher side of the corridor," Vats said.

In H1, Pidilite's consolidated net sales rose 10.5 per cent to Rs 6,740 crore, along with 25.2 per cent Ebitda.

"Therefore, we will continue to work on different parts of our portfolio or product innovation, marketing initiatives and be able to continue to deliver double-digit underlying volume growth profitably and in the profit corridor of Ebitda, which we've talked about 20 to 24 per cent," said Vats, who assumed the role of Managing Director earlier this year on April 10, 2025.

He took over from Bharat Puri, who had served as Managing Director for a decade and is now the Non-Executive and Non-Independent Director on the company's board.

Pidilite, which reported Ebitda of 24.6 per cent in the first half of FY26, expects this to be on the higher side in the second half.

When asked about urban versus rural growth, the MD expects the urban market, which has been stressed over the last few quarters, to start growing and look better.

"We have seen rural growth rate higher than urban, but... in urban areas, we have seen a pick up in growth in quarter two. We should continue to see growth pick up in urban areas as well, but because of the work which we do, because of under penetration, we will continue to see strong growth in rural areas as well," he said.

Like other industry players, rural areas have witnessed significant growth for Pidilite.

"Our rural growths continue to outgrow urban, but this quarter we had very good urban growth as well. So, this time, the rural growths are about 100, 150 bits higher than urban growths, but rural growths are still high," he said, adding that "urban growth will start to sort of grow and look better".

Replying to another query on the impact on demand and commodity prices amid the current geopolitical situation, Vats said the situation remains volatile, like for most businesses. However, Pidilite's direct exposure to tariffs is lower, and allows us to manage business independently of the fluctuation and uncertainty.

".... but we keep a close watch on this and we keep looking at it, and particularly from a supply chain point of view, we have built more business contingency plans as we go forward. So, I think that ensures us a little bit as we go forward," Vats added.