Pidilite ramps up marketing spend as sales and margins rise

Pidilite Industries Limited, the leading manufacturer of adhesives, sealants, and construction chemicals, posted solid earnings for the quarter and fiscal year ended March 31, buoyed by strong volume growth and improved margins amid easing raw material costs.

The company reported a 10.2 percent rise in consolidated revenue for the March quarter, supported by an underlying volume growth (UVG) of 9.8 percent across both consumer and industrial segments. The Consumer and Bazaar (C&B) segment saw UVG of 8 percent, while the Business-to-Business (B2B) segment posted a more pronounced 16.4 percent growth.

Gross margins for the quarter improved by 154 basis points over the same period last year, aided largely by benign input prices. Marketing and promotional expenses rose to 5.4 percent of net sales, up from 4.7 percent a year earlier, as the company increased investment in demand generation initiatives. EBITDA margins remained steady at 20.6 percent.

“We have delivered strong underlying volume growth with healthy margins, despite a challenging macroeconomic backdrop,” said Sudhanshu Vats, Managing Director of Pidilite Industries. He added that the company remains “cautiously optimistic” amid improving domestic demand, especially in the construction sector, which is expected to benefit from favorable monsoon forecasts and increased government spending.

Earnings overview

In consolidated terms, net sales for the quarter reached ₹3,130 crore, a 10 percent increase from the year-ago period, excluding results from Pidilite USA and Pulvitec Brazil. Earnings before interest, taxes, depreciation and amortization (EBITDA) rose 10 percent to ₹633 crore. Profit before tax and exceptional items increased 21 percent to ₹601 crore. Net profit climbed 41 percent to ₹428 crore, though the comparison is flattered by an exceptional loss of ₹72 crore in the previous year due to the divestment of the company’s Brazilian unit. The current quarter included an exceptional loss of ₹25 crore, largely stemming from impairment in an associate investment.

On a standalone basis, quarterly net sales stood at ₹2,839 crore, marking a 10 percent year-on-year increase. Standalone EBITDA rose 11 percent to ₹584 crore, and profit before tax surged 31 percent to ₹606 crore. Net profit rose 26 percent to ₹446 crore, impacted by an exceptional loss of ₹20 crore, linked to a loan impairment.

Domestic subsidiaries recorded double-digit sales and EBITDA growth, while international subsidiaries (excluding the U.S. and Brazil) posted flat sales compared with the previous year.

Looking ahead, the company said it will continue investing in supply chain resilience and expanding manufacturing capacity, while also pursuing innovation across its consumer and industrial product lines.