This article first appeared on GuruFocus .
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Consolidated Revenue:Flat at INR 1,168 crores compared to the corresponding quarter last year.
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EBITDA Margin:17.2%, an increase of 442 basis points from 12.78% in the corresponding quarter last year.
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Segment Revenue Growth:9% growth in revenue for the segment, reaching INR 103 crores in Q3 FY26 compared to INR 95 crores in Q3 FY25.
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Adhesive Revenue:Grew to INR 335 crores in Q3 FY26 from INR 20 crores in Q3 FY25.
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Profit Before Tax:Increased by 49% to INR 165 crores in Q3 FY26 compared to INR 111 crores in Q3 FY25.
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Net Profit:Grew by 13% to INR 88 crores in Q3 FY26 compared to INR 78 crores in Q3 FY25.
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Working Capital Days:Increased by 8 days to 64 days as of December 25th, compared to September 30th, 25.
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Release Date: January 30, 2026
For the complete transcript of the earnings call, please refer to the full earnings call transcript .
Positive Points
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Kajaria Ceramics Ltd ( BOM:500233 ) reported a significant improvement in EBITDA margin, increasing by 442 basis points to 17.2% compared to the previous year.
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The company successfully converted a production unit to focus on value-added products, aligning with market demand.
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Revenue from the adhesive segment grew significantly to INR 335 crores in Q3 2026, compared to INR 20 crores in the same quarter of the previous year.
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Profit before tax increased by 49% to INR 165 crores in Q3 2026, indicating strong financial performance.
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The company is optimistic about future growth, with January showing encouraging signs and expectations of double-digit volume growth in tiles and sanitary ware.
Negative Points
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Consolidated revenue remained flat at INR 1,168 crores due to no growth in tile volumes and absence of a supplier in a specific division.
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The company experienced a drop in EBITDA margin by 74 basis points sequentially due to discounts offered to reduce stock-keeping units (SKUs).
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Working capital days increased by 8 days, primarily due to an increase in receivables and current liabilities.
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The company faced challenges with dealer churn and destocking, impacting volume growth in the short term.
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There was a decline in tile realization prices, with a 9% drop in own manufacturing product realization, affecting overall sales performance.
Q & A Highlights
Q: Can you provide an update on the volume and margin outlook, considering the recent unification efforts? A: The market scenario was weak, and we undertook destocking at the dealer level, which impacted growth. However, we expect positive growth moving forward. Margins are anticipated to remain between 17% to 18%, and any margin increases will be reinvested into the market through advertising to boost sales.
Q: What is the current status of your cost-cutting measures and their impact on margins? A: Our cost optimization journey is ongoing, and we have identified areas for improvement. Despite a drop in selling prices due to inventory liquidation, we maintained a margin of over 17%. We are working on reducing SKUs to improve efficiency and expect to emerge as a more process-driven company.
Q: How is the export scenario affecting the domestic market, and what is the outlook for gas pricing? A: Indian tile exports fell by 20% in value due to geopolitical disturbances. However, this has not pressured domestic pricing significantly as many export-focused plants in Morbi close when exports decline. Gas prices have been stable, with a slight expected increase, but overall, there is no significant impact anticipated on costs.
Q: Can you elaborate on the strategic focus of Kajaria 2.0 and how you plan to utilize your cash balance? A: Kajaria 2.0 focuses on cross-selling across product lines and targeting the interior designer community. We are strengthening our digital capabilities and hiring senior-level talent. We do not foresee major CapEx in the near future, so our cash balance may increase, which will be used strategically to support growth initiatives.
Q: What are your plans regarding price hikes in the bathware segment, and how do you see tile realization improving? A: We have implemented a price hike of 8% to 12% in faucet products and plan to increase prices in sanitary ware from March. For tiles, we are focusing on selling more value-added products to improve realization. We have converted a ceramic line to GVT, which should enhance our bottom line.
For the complete transcript of the earnings call, please refer to the full earnings call transcript .
