Q1 2027 Pidilite Industries Ltd Earnings Call

August 5, 2026

Operator 2: Ladies and gentlemen, good day and welcome to Pidilite Industries Limited Q1 FY27 earnings conference call hosted by Equirus Securities. As a reminder, all participant lines will be in the listen only mode. There will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during this conference call, please signal an operator by pressing star then zero on your touchtone phone. Please note that this conference is being recorded. I now hand the conference over to Mr. Pranav Mehta from Equirus Securities. Thank you, and over to you, sir.

Operator: Ladies and gentlemen, good day and welcome to Pidilite Industries Limited Q1 FY27 earnings conference call hosted by Equirus Securities. As a reminder, all participant lines will be in the listen only mode. There will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during this conference call, please signal an operator by pressing star then zero on your touchtone phone. Please note that this conference is being recorded. I now hand the conference over to Mr. Pranav Mehta from Equirus Securities. Thank you, and over to you, sir.

Speaker #1: Should you need assistance during this conference call, please signal an operator by pressing star, then zero on your touch-tone phone. Please note that this conference is being recorded.

Speaker #1: I now hand the conference over to Mr. Pranav Mehta from Aquarius Securities. Thank you, and over to you, sir.

Speaker #2: Yeah, thank you, Pranav. Good afternoon, everyone. Thank you for joining this call. From the management side, we have Mr. Sudhanshu, Managing Director, and Mr. Kavindra Singh, Joint Managing Director.

Pranav Mehta: Yeah. Thank you, Palak. Good afternoon, everyone. Thank you for joining this call. From the management side, we have Mr. Sudhanshu, Managing Director, Mr. Samit Das, Joint Managing Director, Mr. Sandeep Batra, Executive Director of Finance and CFO, and Mr. Bhavesh Joshi, Senior VP, Domestic Accounts and Taxation. I'll now hand over the call to Sandeep for his opening remarks. Over to you, sir.

Speaker #2: Mr. Sandeep Batra, Executive Director, Finance and CFO, and Mr. Pravesh Joshi, Senior VP, Domestic Accounts and Taxation. I'll now hand over the call to Sandeep sir for a written greeting.

Speaker #2: Over to you, sir.

Speaker #3: Thank you. Thank you, Pranav, and good afternoon. And a warm welcome to everybody on the call. I'll just keep my opening comments brief. And the board edits meeting yesterday approved the results for the first quarter of the current fiscal and, of course, the after that we had our AGM at which the proposed dividend of 11 rupees 50 paise was approved by the shareholders.

Sandeep Batra: Thank you, Pranav, and good afternoon and a warm welcome to everybody on the call. I'll just keep my opening comments brief. The board at its meeting yesterday approved the results for the first quarter of the current fiscal. Of course, after that, we had our AGM, at which the proposed dividend of INR 11.50 was approved by the shareholders. Coming to the performance for the quarter, standalone revenues grew by 22.2% with an underlying volume growth of 11.3%. In absolute terms, the revenue was INR 4,237 crore. As we had mentioned in the full year earnings call, we had taken price increases, which were taken across all categories, to offset the increase in input costs. If you look at the underlying volume growth for the quarter, Consumer and Bazaar businesses underlying volume growth was 12.2% and for B2B was 7.3%.

Speaker #3: Coming to the performance for the quarter, standalone revenues grew by 22.2%, with an underlying volume growth of 11.3%. In absolute terms, the revenue was ₹4,237 crore.

Speaker #3: As we had mentioned in the full-year earnings call, we had taken price increases, which were implemented across all categories to offset the increase in input costs.

Speaker #3: If you look at the underlying volume growth for the quarter, Consumer and Bazaar businesses' underlying volume growth was 12.2%, and for B2B it was 7.3%.

Speaker #3: The reason why the B2B underlying volume growth was lower was largely because of lower exports. B2B exports UVG for the quarter was minus 8.4%.

Sandeep Batra: The reason why the B2B underlying volume growth was lower was largely because of lower exports. B2B exports QVG for the quarter was -8.4%. Overall exports for the company also de-grew in the first quarter, largely because of geopolitical issues in some of our key markets. Gross margins at 52.5% were lower than last year, same period by 90 basis points. VAM consumption in the quarter was at $1,370 as compared to last year, $924, and the fourth quarter was in the 800 range. However, total costs below gross margin increased slower than the revenue growth. The total cost increase was 14.5%. A large chunk of that was advertising and sales promotion. This operating leverage flowed into the EBITDA. EBITDA margins at 26.4% improved by 80 basis points quarter on quarter. Profit after tax grew by 27.7%. This was a standalone performance.

Speaker #3: And overall exports for the company also degrew in the first quarter, largely because of geopolitical issues in some of our key markets. Gross margins at 52.5% were lower than last year, same period, by 90 basis points.

Speaker #3: VAM consumption in the quarter was at $1,370, as compared to last year’s $924. The fourth quarter was in the $800 range. However, total costs below gross margin increased slower than the revenue growth.

Speaker #3: The total cost increase was 14.5%. A large chunk of that was advertising and sales promotion. This operating leverage flowed into the EBITDA. EBITDA margins at 26.4% improved by 80 basis points quarter on quarter.

Sandeep Batra: The total cost increase was 14.5%. A large chunk of that was advertising and sales promotion. This operating leverage flowed into the EBITDA. EBITDA margins at 26.4% improved by 80 basis points quarter on quarter. Profit after tax grew by 27.7%. This was a standalone performance.

Speaker #3: And profit after tax grew by 27.7%. This was the standalone performance. If I look at the performance of the subsidiaries, both the domestic as well as the overseas subsidiaries reported double-digit revenue growth.

Sandeep Batra: If I look at the performance of the subsidiaries, both the domestic as well as the overseas subsidiaries reported double-digit revenue growth. Domestic subsidiaries grew by 11.5% and international subsidiaries grew by 12%. Again, the growth there was led by Consumer and Bazaar businesses in the domestic subsidiaries, which grew by 17%. The B2B part of the domestic subsidiaries had a modest growth of 3.5%. International subsidiaries, again, growth was reasonably broad-based with Bangladesh, Egypt, and Kenya subsidiaries recording much better than their past growth records. Consolidated revenues at INR 4,541 crore were up by 21.3%. EBITDA margin improved by 120 basis points over the same period last year, and profit after tax grew by 30.3%. That's all from an opening remarks point of view. Happy to open the floor for questions.

Speaker #3: Domestic subsidiaries grew by 11.5%, and international subsidiaries grew by 12%. Again, the growth there was led by consumer and bazaar businesses in the domestic subsidiaries.

Speaker #3: Which grew by 17%. And the B2B part of the domestic subsidiaries had a modest growth of 3.5%. International subsidiaries again, growth was reasonably broad-based, with Bangladesh, Egypt, and Kenya subsidiaries recording much better than their past growth records.

Speaker #3: Consolidated revenues at ₹4,541 crores were up by 21.3%. EBITDA margin improved by 120 basis points over the same period last year, and profit after tax grew by 30.3%.

Speaker #3: So that's all from an opening remarks point of view. Happy to open the floor for questions.

Speaker #1: Thank you very much. We will now begin the question and answer session. Anyone who wishes to ask a question may please press star and one on their touch-tone telephone.

Operator 2: Thank you very much. We will now begin the question and answer session. Anyone who wishes to ask a question may please press star and one on their touchtone telephone. If you wish to remove yourself from the question queue, you may press star and two. Participants are requested to use handsets while asking a question. Ladies and gentlemen, we'll wait for a moment while the question queue assembles. The first question is from the line of Abneesh Roy from Nuvama. Please proceed with your question.

Operator: Thank you very much. We will now begin the question and answer session. Anyone who wishes to ask a question may please press star and one on their touchtone telephone. If you wish to remove yourself from the question queue, you may press star and two. Participants are requested to use handsets while asking a question. Ladies and gentlemen, we'll wait for a moment while the question queue assembles. The first question is from the line of Abneesh Roy from Nuvama. Please proceed with your question.

Speaker #1: If you wish to remove yourself from the question queue, you may press star and two. Participants are requested to use handsets while asking a question.

Speaker #1: Ladies and gentlemen, we'll wait for a moment while the question queue assembles. The first question is from the line of Avnish Roy from Nuvama.

Speaker #1: Please proceed with your question.

Speaker #4: Yes. Congrats on the exports. When the geopolitical issues get resolved, would you expect bunched-up demand, pent-up demand, or do you think some part of this demand was met by other suppliers?

Abneesh Roy: Yes. Congrats on great numbers. First question is on the exports. When the geopolitical issues get resolved, do we expect a bunch of demand or pent-up demand, or some part of this demand was made by other suppliers? If you could clarify on that.

Speaker #4: If you could clarify that.

Speaker #5: Yeah. So I think, Avnish, thank you, first of all, and always good to hear from you. And I think, you know, it's so good that you've been—you're always our opening, the opening battlements, I think.

Sudhanshu Vats: Yeah. I think, Abneesh, thank you, first of all, and always good to hear from you, and it is so good that you have been. You are always the opening batsman, I think. Thank you. Thank you once again for the results. We have delivered strong set of results, so thank you very much. I think on exports, as the situation normalizes, lot of our export business will come back. It will come back. Because most of our contracts are there. It is also possible that in this interim period, some of the people may have made some alternate arrangements, and I do not want to get into specifics of it. Suffice to say, to answer your question, that as the geopolitical situation stabilizes, our exports will come back.

Speaker #5: And thank you. Thank you once again for the results we've delivered. Strong set of results, so thank you very much. I think on exports, as the situation normalizes, a lot of our export business will come back.

Speaker #5: It will come back. Now, because most of our contracts are there now, it is also possible that in this interim period, some of the people may have made some alternate arrangements.

Speaker #5: And I don't want to get into the specifics of it. But suffice to say, to answer your question, that as the geopolitical situation stabilizes, our exports will come back.

Speaker #4: Sure. The largest paint company has put up the VAM/VAE facility, and you do compete with that company in many segments. From a relative positioning perspective in terms of cost and product pricing, does this change anything meaningfully for you?

Abneesh Roy: Sure. The largest paint company has put up the VAM VAM-VAE facility, and you do compete with that company in many segments. From a relative positioning perspective in terms of cost and, say, pricing and product pricing, does this change anything meaningfully for you?

Speaker #5: So Avnish, our understanding is that I think it's best, of course, answered by the company that has put up the capacity. But our under first of all, fundamentally, there are two business models.

Sudhanshu Vats: Abneesh, our understanding is that I think it is best, of course, answered by the company that has put up the capacity. First of all, fundamentally, there are two business models, and both business models are good business models. You could have something captive and perhaps operate in the entire value chain. You could have, basically, you have your brand and your product, and you focus on your brand and product quality and servicing the customer. From the procurement point of view, you operate through basically what is in the market, and you basically ride the crest and trough of the raw material. I think the point is we are in the latter camp, I think, as you are aware. I do not think it should change anything materially.

Speaker #5: And both business models are good business models. So, you know, you could have something captive and perhaps operate in the entire value chain. Or you could basically have your brands and your product, and you focus on your brand and product quality.

Speaker #5: And servicing the customer. And from the procurement point of view, you operate through basically what is in the market, and you basically ride the crescent trends of the raw material.

Speaker #5: So I think the point is we are in the latter camp. I think as you are aware, I don't think it should change anything materially.

Sudhanshu Vats: In our assessment, multiple times over on ours, when we have done it ourselves, and also when we have looked at and talked to a few of the experts in this space who know this very well, and some of the large companies across the globe, I think the competitive advantage case for India from availability of base raw material, from the point of view of the scale needed to get that kind of cost leverage and advantage, does not seem to come through in all our conversations. I just wanted to share that. Having said that, I think they have chosen to do this. My understanding is also it may or may not be directly for adhesive. It may be for other things as well. I think that is the piece. Therefore, they have multiple businesses.

Speaker #5: And in our assessment, multiple times over on ours, when we've done it ourselves, and also when we have looked at and talked to a few of the experts in this space who know this very well, and some of the large companies across the globe, I think the competitive advantage case for India from availability of base raw material from the point of view of the scale needed to get that kind of that kind of cost leverage and advantage doesn't seem to come through in all our conversations.

Speaker #5: I just wanted to share that. Having said that, I think they've chosen to do this. My understanding is also that it may or may not be directly for adhesive.

Speaker #5: It may be for, you know, other things as well. So I think that's the piece. Therefore, they have multiple businesses. So I think the point I'm making is that that's an independent decision.

Sudhanshu Vats: I think the point I'm making is that that's an independent decision. It's a different business model. As far as our business model is concerned, our way of doing things is concerned, we've sort of revisited this. We've had detailed conversation with some of our large partners and vendor suppliers, we are confident of running this as well as we've done in the past and should not have any impact.

Speaker #5: It's a different business model. As far as our business model is concerned, our way of doing things is concerned, and we've sort of revisited this.

Speaker #5: We've had detailed conversations with some of our large partners and vendor suppliers, and we are confident of running this well, as well as we've done in the past. This should not have any impact.

Speaker #4: Sure. My next question is on the two innovations you have put in the presentation. So, what will be the expectation from this most technologically advanced adhesive?

Abneesh Roy: Sure. My next question is on the two innovations you have put in the presentation. What will be the expectation from this most technologically advanced adhesive? Is this too niche? It says anti-bending property. For what use case it is? Similarly for the professional end seal washable, are these very disruptive product or these are just some good niche product? Are these big potential long-term from a revenue perspective?

Speaker #4: Is this too niche? It says anti-bending property. So for what use case it is, and similarly for the professional M seal washable, are these very disruptive products or these are just some good niche products?

Speaker #4: Are these big potential, long-term, from a revenue perspective?

Speaker #5: No, Avnish, that's a very good question, and I'm glad you asked it upfront. I think both these innovations that you pointed out this time around are fundamental innovations.

Sudhanshu Vats: No, Abneesh, that's a very good question, I'm glad you asked it upfront. I think both these innovations which we put up this time around are fundamental innovations. They are technologically advanced products in that space. Within our business, they are not fringe innovations. They are core innovations. Let me just give you a quick this thing and maybe take one example, but it's true for both. Let me take the example of Fevicol Expo. You see, when you do woodworking in your house, particularly when you do almirah doors, cupboard doors, depending on the laminate you've used on one side and the laminate you've used on the inner side, or sometimes no laminate on the inner side, because that's a practice in India.

Speaker #5: They are technologically advanced products in that space. And within our business, they are not fringe innovations—they are core innovations. Let me just give you a quick distinction and maybe take one example.

Speaker #5: But it's true for both. But let me take the example of Ferricol Expo. So you see, when you do, you know, woodworking in your house, particularly when you do Almira doors, you know, covered doors, depending on the laminate you've used on one side and the laminate you've used on the inner side or sometimes no laminate on the inner side because that's a practice in India.

Speaker #5: The laminate used on the front side is of a different quality and a different, this thing. And the laminate used, which is on the reverse of the door, as you open the door.

Sudhanshu Vats: The laminate used on the front side is of a different quality and different this thing, the laminate used which is on the reverse of the door as you open the door, either there is no laminate or it's of a different quality. Based on this, what one common complaint we used to hear was what is called bending of the door. I'm saying, therefore that I just want to take a minute to explain that how much core or central it is. I think this technology, one of the biggest advantages of the technology is also anti-bending.

Speaker #5: Either there is no laminate, or it's of a different quality. Based on this, one common complaint we used to hear was what is called 'bending of the door.'

Speaker #5: So I'm saying, you know, so, and therefore, I just want to take a minute to explain how core or central it is.

Speaker #5: I think this technology, one of the biggest advantages of the technology is also anti-bending. So therefore, once you are able to use this product, you are assured of the doors not bending, doors closing properly, basically not sort of so that is a common problem faced.

Sudhanshu Vats: Therefore, once you are able to use this product, you are assured of the doors not bending, doors closing properly, basically not sort of. That is a common problem faced, and therefore you are addressing a relatively prevalent or relatively quite prevalent kind of a problem with the product. I think the other one is very similar. It is basically multiple things it scores on, as we call this the M-Seal Advance. It is lower on VOC, it is very low on smell, easy to wash off. It is also, you can use it on different types of plastic pipes and all that. Both are very fundamental innovations. I would call them core innovations and with strong potential.

Speaker #5: And therefore, you are addressing a relatively prevalent, or relatively quite prevalent, kind of a problem with the product. And I think the other one is very similar; it is basically multiple things it scores on, as we call this, the M-Seal Advanced.

Speaker #5: It's lower on VOC. It's very low on smell. Easy to wash up. It's also a multi you can use it on different types of, you know, plastic pipes and all that.

Speaker #5: So both are very fundamental innovations. I would call them core innovations, and with strong potential.

Speaker #4: Sure. Last question. So essentially, VAM went up sharply and has also come down very sharply. Could you tell us the current price, and given that crude has also fallen?

Abneesh Roy: Sure. Last question. Essentially, VAM went up sharply, has come down also very sharply. If you could tell us current price, and the crude has also fallen. Is your double-digit price hike, which you have taken at the company level, is that now too much? Are you giving now more trade discounts and basically trade margins? How are the local players or the other players responding? It is a competitive market, and definitely your double-digit price hike is unprecedented, and then we have seen the RM fall also very sharply.

Speaker #4: So, is your double-digit price hike, which you have taken at the company level, now too much? So, are you now giving more trade discounts and, basically, trade margins?

Speaker #4: And how are the local players or the other players responding? Because it's a competitive market. And definitely, your double-digit price hike is unprecedented.

Speaker #4: And then we have seen the RM fall also very sharply.

Speaker #5: So maybe I'll ask Sandeep to also tell you the exact numbers, but I can give you the order of magnitude. But I'll tell you, Avnish, basically, this is fluctuating quite a lot here.

Sudhanshu Vats: Maybe I'll ask Sandeep to also tell you exact numbers, but I can give you order of magnitude. I tell you, Abneesh, basically, this is fluctuating quite a lot here. Therefore, to tell something at this point in time, I am saying, it did go up very sharply. You are absolutely right, from about $800, $900 to maybe all the way close to $2,000, then fell down quite a lot, but maybe going up a little. The dynamic is far more dynamic than maybe we have seen in the past. Maybe we have seen it once or twice, but even there, the yo-yoing is, I think, quite unique. As you know, VAM is a little bit decoupled from directly crude as well. I think there are multiple other factors which are sort of driving some of these things.

Speaker #5: So, therefore, to tell something at this point in time, I'm saying, it did go up very sharply. You are absolutely right—from about $800, $900 to maybe all the way close to $2,000.

Speaker #5: And then fell down quite a lot, but then maybe going up a little. So the dynamic is a little bit more—it's far more dynamic than maybe we've seen in the past; maybe we've seen it once or twice.

Speaker #5: But even there, the yo-yoing is, I think, quite unique. And as you know, VAM is a little bit decoupled from crude as well.

Speaker #5: So, I think there are multiple other factors which are sort of driving some of these things. And so, what we've done—and to your point, what we do—is we take the feedback of the market.

Sudhanshu Vats: What we have done, and to your point, what we do is we take the feedback of the market. Fortunately, as a company, we are very close to our customer, therefore we understand what is happening, what are their pain points, and so on and so forth. You are right in your conceptual thinking that depending on the movement of this, we could end up giving some rebate. It is possible that in a period, I am saying, we would be giving a rebate, that is absolutely correct. It is possible that in a period we would sort of withdraw that, and so on and so forth. If you remember correctly, while the quantum you are right is this time we were more proactive, more than the quantum. We were proactive, and I think that really helps, and you can see that in the numbers as well.

Speaker #5: Fortunately, as a company, we are very close to our customer, you know, and therefore, we know what are their pain points and so on and so forth.

Speaker #5: So, you are right in your conceptual thinking that, depending on the movement of this, we could end up giving some rebate.

Speaker #5: So it's possible that in a period, I'm saying, you know, we would be giving a rebate, and that's absolutely correct. And it's possible that in a period, we would sort of withdraw that and so on and so forth.

Sudhanshu Vats: It is possible that in a period we would sort of withdraw that, and so on and so forth. If you remember correctly, while the quantum you are right is this time we were more proactive, more than the quantum. We were proactive, and I think that really helps, and you can see that in the numbers as well.

Speaker #5: So, and if you remember correctly, while the quantum—you are right—is this time, we were more proactive, more than the quantum. We were proactive.

Speaker #5: And I think that's really helped, and you can see that in the numbers as well. But my point is that we were, and we spoke about it in the last call, in our full year and Q4 FY26 call.

Sudhanshu Vats: My point is that we were, and we spoke about it in the last call in our full year and Q4 FY26 call. We covered for the increase in raw material price. We did not cover fully for the margin. In a manner of speaking, we had taken some of the hit and we had sort of basically passed on a lot of that hit, but we had absorbed a little bit of it as well. The point is that between the two, we are broadly okay. We will play with a little bit of rebate. As far as competition is concerned, we keep a close eye on competition anywhere in the country, and we will continue to do that. In this particular example, especially in this example, Abneesh, and in this category, competition tends to follow us almost to the T.

Speaker #5: We covered for the increase in raw material price. We did not cover fully for the margins. In a manner of speaking, we had taken some of the hit and we had sort of we had basically passed on a lot of that hit, but we had absorbed a little bit of it as well.

Speaker #5: So, the point is that between the two, we are broadly okay. We will play with a little bit of rebate. As far as competition is concerned, we keep a close eye on competition anywhere in the country.

Speaker #5: And we will continue to do that. And in this particular example, especially in this example, Avnish, and in this category, competition tends to follow us almost to the T.

Speaker #5: So I saw that when we have taken up the prices, almost everyone has taken up the prices. When we are taking a rebate, almost everyone is taking a rebate.

Sudhanshu Vats: I saw when we've sort of taken up the prices, almost everyone has taken up the prices. When we are taking a rebate, almost everyone is taking a rebate. Sometimes you could actually, if you mark the letter, the letterhead of the letter, you will see they are almost identical. To that extent, I think that I just anecdotally to tell you. Having said all of this, we keep a very close watch. More importantly, at Pidilite, we have always believed in a win-win philosophy where we will make sure that the value to our customers is right, and therefore, and we are doing what is right in their interest as much as it is in ours. I think as long as we follow that philosophy, I think we are in a good space in my judgment.

Speaker #5: Sometimes, you could actually, you know, if you mask the letterhead of the letter, you will see they are almost identical. So, to that extent, I think there are, just anecdotally, to tell you.

Speaker #5: I think but we keep it we are having said all of this, we keep a very, very close watch. And more importantly, as Pidilite, we have always believed in a win-win philosophy where we will make sure that the value to our customers is right and therefore and we are doing what is right in their interest as much as it is in ours.

Speaker #5: So, I think as long as we follow that philosophy, we are in a good space, in my judgment.

Speaker #4: One follow-up here, and I'll end there. You want to change the lower end of the guidance, because in most quarters, either you are at the top end or you are even beating the top end.

Abneesh Roy: One follow-up here, and I'll end there. You want to change the lower end of the guidance because in most quarters, either you are at the top end or you are even beating the top end. Structure, is there any change to the margin profile? The 20% lower end of the margin may not have any relevance now because 4, 5 quarters have happened.

Speaker #4: Structurally, is there any change to the margin profile? And so the 20% lower end of the margin may not have any relevance now because four, five quarters have happened.

Sandeep Batra: Abneesh, while if you look at our last few quarters' performance, what you say is valid. If you look at a slightly longer period, particularly the time when we saw a very steep increase in input cost, our margins had indeed fallen into the high teens. Of course, they recovered. The world that we are living in with all these risks and uncertainties, we would still prefer to keep a corridor which gives us enough operating flexibility. No need to change it at this stage.

Speaker #5: Avnish, you know, while if you look at our last few quarters' performance, what you say is valid. But if you look at a slightly longer period, particularly the time when we saw a very steep increase in input costs, our margins had indeed fallen into the high teens.

Speaker #5: And of course, they recovered. And you know, the world that we are living in with all these risks and uncertainties, we would still prefer to keep a corridor which gives us enough, you know, operating flexibility.

Speaker #5: So, no need to change it at this stage.

Speaker #4: Sure. Thank you. That's all from my side. Thank you.

Abneesh Roy: Sure. Thank you. That's all from my side. Thank you.

Speaker #1: Thank you, sir. The next question is from the line of Jaykumar Doshi from Kotak Securities. Please proceed with your question.

Operator 2: Thank you, sir. The next question is from the line of Jay Doshi from Kotak Securities. Please proceed with your question.

Operator: Thank you, sir. The next question is from the line of Jay Doshi from Kotak Securities. Please proceed with your question.

Speaker #4: Hi, Deep. Congratulations on good set of results. And thanks for the opportunity. I've got two questions. The first one is standalone consumer bazaar UVG was around 15% last quarter.

Jay Doshi: Hi, team. Congratulations on good set of results, and thanks for the opportunity. I've got two questions. The first one is, standalone consumer bazaar UVG was around 15% last quarter. Last earnings call until then, you were fairly confident that the momentum. At that point of time, you had indicated that the momentum had continued into April and May as well. The slight moderation to about 11 odd % or 12% from 15%, I'm just referring to C&B right now. Did you see any moderation in June, anything to call out here? Or the second is, should this be considered as a more normal, UVG band for rest of the year, or are you expecting some acceleration going ahead?

Speaker #4: I think this calendar year started off on a very strong note. And last earnings call until then you were fairly confident that the momentum at that point of time you had indicated that the momentum had continued into April and May as well.

Speaker #4: So the slight moderation to about 11% from 15%. I'm just referring to CNB right now. Has did it did you see any moderation in June that, you know, anything to call out here or, you know, and second is should this be considered as a more as a normal UVG band for rest of the year or are you expecting some acceleration going ahead?

Speaker #5: So Jay, I think—I don't know whether both the questions... So, thank you, first of all, Jay, and thank you for the compliments as well to all of Pidilite and to the team.

Sudhanshu Vats: Jay, I think I don't know whether both the questions. Thank you, first of all, Jay, and thank you for the compliments as well to all of Pidilite and to the team, I think, from your side. I think the way I interpret this data, let me also share the data with you, and I think we talk about it. I think if you look at our C&B business, and I'm trying to give you now 3-year CAGR, 2-year CAGR, last year, and this quarter. If you look at, from my point of view, our 3-year CAGR is, let's say, 9 something.

Speaker #5: I think, you know, from your side. I think the way I interpret this data, let me also share the data with you. And I think we talk about this.

Speaker #5: So I think if you look at our CNB business, and I'm trying to give you now, you know, three-year CAGR, two-year CAGR, last year and this quarter.

Speaker #5: So, if you look at it from my point of view, our three-year CAGR is, let's say, nine-something. Our two-year CAGR is about ten-something.

Jay Doshi: Yeah.

Sudhanshu Vats: Our two-year CAGR is about 10 something. Our last year or 10 point something higher. Our last year, full year, actually, in C&B again, is around 11 something. Against that, we are now in Q1 at 12 and a half. Just the Q4, I think is one data point. If you remember, even in our last call, we had said that treat our last year's UVG as 11.1 or what the number, if I remember right, 11.1 for the year. I think that's a step up on our previous year, which was nine point something. It is a step up. We recognize that. We would like to continue that step-up. I think in that context, we see this as a normal trend. There's nothing no month or any such thing.

Speaker #5: Our last year was 10 point something higher. Then our last year's full year, actually in CNB again, is around 11 point something. And against that, we are now in quarter one at 12 and a half.

Speaker #5: So, therefore, just the Q4, I think, is one data point. And if you remember, even in our last call, we had said that—treat our last year's UVG as 11.1 over the number, if I remember right, 11.1 for the year.

Speaker #5: And I think that's a step up from our previous year, which was nine point something. So, therefore, it is a step up, and we recognize that.

Speaker #5: We would like to continue that step up, so I think in that context, we see this as a normal trend. There's nothing—no month or any such thing.

Sudhanshu Vats: I think we should be looking at similar, this thing, especially in this year, Jay, because you should see that this UVG, underlying volume growth, is coming on the price which is there. I think to be able to deliver this UVG with this price, broadly this price, where and as we see as the year progresses, nobody can say anything at the moment here. The point I'm making is that in this context, assuming this is the context and there's some price which is there through the year, I think this is a good number. This is the quantitative aspect of it, Jay. I think from the point of view of market, you know all of us keep traveling all the time, Kavinder, myself, we are all in the market, most of, and even more so now.

Speaker #5: As you are and I think we should be looking at similar this thing, especially in this year, Jay, because you should see that this UVG, underlying volume growth is coming on the price which is there.

Speaker #5: So I think to be able to deliver this UVG at this price, broadly this price there, and as we see as the year progresses, nobody can say anything at the moment here.

Speaker #5: But the point I'm making is that in this context—assuming this is the context and there's some price which is there through the year—I think this is a good number.

Speaker #5: This is a quantitative aspect of it, Jay. I think from the point of view of market and, you know, all of us keep traveling all the time, when the mic sells, we are all in the market most of and even more so now.

Speaker #5: I can tell you very, very categorically that the demand is holding quite well. So, I think we are not seeing any kind of concern on demand at the moment at all.

Sudhanshu Vats: I can tell you very categorically that the demand is holding quite well. I think we are not seeing any kind of concern on demand at the moment at all. The demand is holding well, in our judgment, the trend is positive and in the right direction.

Speaker #5: So I think demand is holding well, and in our judgment, the trend is positive and moving in the right direction.

Speaker #4: Thank you. One more question. One of the South India-based regional cement companies, as you know, is planning to foray into tile adhesives with very ambitious targets.

Jay Doshi: Thank you. One more question. One of the South India-based regional cement companies is planning to foray into tile businesses with very ambitious targets. What are your thoughts? Are you seeing any sort of change in the competitive intensity on the ground and any thoughts here?

Speaker #4: You know, so what are your thoughts? Are you seeing any sort of change in the competitive intensity on the ground, and any thoughts here?

Speaker #5: Yeah, so let me quickly give you one headline thought, but I'll pass it on to Karinder to talk about this in quite some detail for you.

Sudhanshu Vats: Yeah. Let me quickly give you one headline thought, but I will pass it on to Kavinder to talk about this in quite some detail for you. I think, first of all, I think as this segment is growing, there will be competition. I think competition could come from cement manufacturers, they could sometimes come from tile manufacturers themselves thinking, We do tile, we should also do. I hope to some extent this answers your question.

Speaker #5: I think, first of all, as this business, as this segment is growing, there will be competition. And I think competition could come from cement manufacturers.

Speaker #5: They could sometimes come from tile manufacturers themselves, thinking, "We do tile, we should also do it." And of course, there has been existing competition from some of the larger players.

Speaker #5: So I think the competitive intensity could vary and could change. But I think we are quite well equipped with our brand. But I think that's a headline thought that we just shared.

Speaker #5: Let me just ask Karinder to give you a little bit more context and color on this.

Speaker #4: Thank you, Sushantu. I'll

Speaker #5: just sort of build a little more from where Sushantu left off. category is facing intense competition. And the South Indian manufacturer that you talked about, we are aware of that.

Speaker #5: So, on the ground, if I were to say, we are maintaining our momentum. In fact, we are accelerating—number one. Number two, we are also very mindful of the emerging competition.

Speaker #5: Our biggest strength today, which is, you know, sort of known also and I would reiterate, is our wide plant network, which we are expanding.

Speaker #5: Number two, consistent quality. We are investing in our plants in a manner that the quality consistency improves. These products are susceptible to product inconsistency.

Speaker #5: And therefore, if you have not got the right technology, the right level of, let's say, automation, you could get into the consistency problems. Third, extreme focus on cost management both on the input side as well as, let's say, we use a concept called total delivered cost.

Speaker #5: So, when I look at these metrics of cost, quality, and timely availability through the plant network that we have built, we are building our own moat.

Speaker #5: And of course, ROF as a brand has seen significant investments on the ATL as well. Our team on the ground is constantly working both on the distribution side, which is the sales part, and the business development team is continuously working with the contractors who are in this business.

Speaker #5: So our moat is always to work very closely on the ground with the tile dealers, who comprise majority of the sales now of this particular category.

Speaker #5: Of course, there are other dealers as well, and also the contractors. So, we will continue to focus on our playbook while being mindful of the new competition that is emerging.

Speaker #5: And our team is quite motivated to deal with this challenge of seeing increased competition, and our focus remains on our playbook and continuously adjusting, depending on what we see in the market.

Speaker #5: By the way, since we are on the call, I will also highlight that one of the products that we have launched in about two quarters ago and we have mentioned this already, called New Pro, is seeing increased momentum and we are now going beyond one plant to four plants to ensure that this is available in wider geographies.

Speaker #5: This is a product that we have launched through our, you know, joint venture with our Spanish partners. And this is something that we can also share the good news that the premium end of the market, we effectively occupy extremely well.

Speaker #5: And that's another area that we are focused on, in terms of premiumizing our range as well. So, I hope to some extent this answers your question.

Speaker #4: Thank you very much.

Jay Doshi: Thank you very much.

Speaker #5: Thank you, Jay.

Sudhanshu Vats: Thank you, Jay.

Speaker #4: Totally.

Speaker #2: Thank you, sir. The next question is from the line of Arnav Mitra. Please proceed with your question.

Operator 2: Thank you, sir. The next question is from the line of Arnab Mitra from Goldman Sachs. Please proceed with your question.

Operator: Thank you, sir. The next question is from the line of Arnab Mitra from Goldman Sachs. Please proceed with your question.

Speaker #5: Yeah, hi. I'm again congratulating you on a great quarter. My first question is on demand. We have seen price increases from Pidilite as well as all other building material companies.

Arnab Mitra: Hi, again, congratulations on a great quarter. My first question was on demand. We've seen price increases from Pidilite as well as all other building material companies. Have you seen at all the price hikes have fully happened by June, any impact of price elasticity on demand on any of your categories? A related question is, in this quarter, there was some slow around shortage of construction material like tiles and things like that. Did it have any impact on the growth during this quarter?

Speaker #5: Have you seen if all the price hikes have fully happened by June? Any impact of price elasticity on demand in any of your categories?

Speaker #5: And a related question is, in this quarter, there was some news flow around, you know, shortage of construction material like tiles and things like that.

Speaker #5: Did it have any impact on the growth during this quarter? Yeah. Arnav, thank you for the—you know, thank you for your compliment. And I think Pidilite and the team fully deserve it.

Sudhanshu Vats: Arnab, thank you for your compliments, and I think Pidilite and the team fully deserve it, I think. I'll pass on to everyone. Thank you so much. Let me take the second question first. I think, tiles per se as a sector had reasonably high market inventory, if I could call it, particularly premium tiles where most tile adhesive gets used. Therefore, the impact on the industry which we saw at the beginning of the last quarter from the point of view of availability of gas and others, did not immediately impact the market. Definitely not the higher-end market. There could be sporadic cases here and there, but not meaningfully in any which way. That's the first part. I think on the second part of your question, just remind me the question again, Arnab, the first part we discussed of the question.

Speaker #5: I think so. I'll pass on to everyone. Thank you so much. I think—let me take the second question first. I think, see, tile—tiles per se as a sector have reasonably high market inventory, if I could call it, particularly premium tiles, where most tile adhesive gets used.

Speaker #5: Therefore, the impact on the industry, which we saw at the beginning of the last quarter from the point of view of availability of gas and other factors, did not immediately impact the market.

Speaker #5: Definitely not the higher-end market. There could be sporadic cases here and there, but not meaningfully in any way. So that's the first part.

Speaker #5: I think on the second part of your question—just remind me of the question again. Arnav, the first part which you said in the question.

Arnab Mitra: This is general price elasticity of demand given-

Speaker #4: This is general price elasticity of demand.

Speaker #5: Yeah, yeah, yeah. Yeah, yeah, yeah. Great. So I tell you, two, three things, you know, and I'll—we've discussed this internally quite a lot.

Sudhanshu Vats: Great. I tell you two, three things, and we discuss this internally quite a lot. I think first is what to give you a little bit of context to everyone here. I think, see, unlike fast-moving consumer goods, where there is a direct comparison of a product price from month to month, because by definition, they are used at that kind of frequency, the impact by the consumer is felt immediately. In our kind of categories, largely bazaar particularly, people plan their project and say that they have an outlay for the project, and then they work within that outlay. Let's say you plan your project, and then you have a budget for your project. I think while the prices have gone up, if the project is already on, then people normally don't stop it.

Speaker #5: I think first is what to give you a little bit of context to all everyone here. I think, see, unlike fast-moving consumer goods, where there is a direct comparison of a product price from month to month, because by definition they are used at that kind of frequency, the impact by the consumer is felt immediately.

Speaker #5: In our kind of categories, largely bazaar particularly, people plan their projects and say that they have an outlay for the project, and then they work within that outlay.

Speaker #5: So they have a—let's say you've planned your project. So I think while the prices have gone up, we've seen that if the project is already on, then people normally don't stop it.

Speaker #5: So that continues. And if you start anew, then you can sort of, you know, sometimes think through it or recalibrate it. So, to answer your question, I don't see—we are not seeing any impact on demand at the moment.

Sudhanshu Vats: That continues, if you have to start anew, you can sometimes think through it or recalibrate it. To answer your question, we've not seen any impact on demand at the moment. Also, most of the pricing I think has gone into the market by June. I think that was the question you had. Most of the pricing has gone in June. We've not seen any substantial impact, therefore our hypothesis that people plan a project outlay in a very different way. They interact with our product from a pricing point of view at a frequency of once in two years, once in three years, sometimes once in five years, depending on what you are doing, kind of project you are doing and all that.

Speaker #5: And also, most of the pricing, I think, has gone into the market by June. I think that was a question you had. So, most of the pricing has gone in in June.

Speaker #5: We've not seen any substantial impact. And therefore, our hypothesis is that people plan a project outlay in very different ways. They interact with our product from a pricing point of view at a frequency of once in two years, once in three years, sometimes once in five years, depending on what kind of project you are doing and all that.

Speaker #5: So it's a little so for us, and if you were to look at the weighted average increase on some of our categories and brands, I think that's not substantial because, you know, price had gone up, then it came down a little bit.

Sudhanshu Vats: If you were to look at weighted average increase on some of our categories and brands, I think that's not substantial because price had gone up, it came down a little bit. Therefore, from that point of view, I don't think we've seen anything on that count, and that is good news for us and maybe on similar industries in my judgment.

Speaker #5: So, I think so; therefore, from that point of view, I don't think we've seen anything on that count. And that is good news for us and maybe for similar industries, in my judgment.

Speaker #4: Got it. That's very helpful. My second and last question is actually on margins. Given the very strong margin performance this quarter, I just wanted to understand if you had some benefit of low-cost inventory in this quarter, or consumption averages, and therefore, should we expect gross margins to move down from here as the full impact of the inflation hits?

Arnab Mitra: Got it. That's very helpful. My second and last question is actually on margin. Given the very strong margin performance this quarter, just wanted to understand if you had some benefit of low-cost inventory in this quarter of consumption averages. Therefore, should we expect gross margins to move down from here as the full impact of inflation hits? Would you say that given where broadly spot prices are, you had very similar costs in the last quarter as well? Just wanted to understand were there any one-off benefits which kind of go the way, and therefore margins trend back to that historical range.

Speaker #4: Or would you say that, given that broadly spot prices are similar, you had very similar costs in the last quarter as well? So, I just wanted to understand, were there any one-off benefits which kind of go away, and therefore margins trend back to that historical range?

Speaker #5: Yeah, no, so therefore, in this quarter, I think your observation is correct. See, three things happened in the quarter. Basically, this time around, as Pidilite, we were very proactive in taking our pricing.

Sudhanshu Vats: Yeah. Therefore, in this quarter, I think your observation is correct. I think three things happened in the quarter. This time around at Pidilite, we were very proactive in taking our pricing. Pricing based on replacement margins, which is depending on what the price of that commodity or raw material was at that point in time, we were pricing it based on that. That's replacement margin. Therefore, pricing was proactive. Pricing went into most of the quarter, at least part of the quarter, as the pricing was planned in phased manner. There was in certain categories, not varied from raw material to raw material, product to product and all that, but there was some amount of carryover inventory as well. That's a correct observation, and I think that got consumed in the last quarter. That's absolutely correct.

Speaker #5: Pricing based on replacement margins, which is dependent on what the price of that commodity or raw material was at that point in time—we were pricing it based on that.

Speaker #5: So that's replacement margin. Therefore, pricing was proactive. So pricing went in into most of the quarter, at least part of the quarter, as the pricing was planned in a phased manner.

Speaker #5: Then basically, there was in certain categories, not varies from raw material to raw material product to product and all that, but there was some amount of carryover inventory as well.

Speaker #5: So that's the correct observation, and I think that got consumed in the last quarter. That's absolutely correct. And lastly, because of prices going up last quarter—almost, you know, and maybe in two or three stages—not only for us, but across the board, as you had only asked in your previous question, there was also some moderation in scheme.

Sudhanshu Vats: Lastly, because of prices going up last quarter almost, maybe in two or three stages, not only ours, across the board as you had only asked in your previous question, there was also some moderation in scheme. I think combination of all three gave us the advantage here. I think some of it will correct in Q2. My view is that you should first of all look at H1 when you look at Pidilite as H1. What gives us confidence at the end of Q1 is that with the proactive pricing that we have taken and with the way we are managing our business and with demand holding on, I am saying all three conditions, I think we will see a year where we manage our margin quite well is all I can tell you.

Speaker #5: So I think the combination of all three gave us the advantage here, and I think some of it will correct in the second quarter. But my view is that you should, first of all, look at the first half when you look at Pidilite—as the first half.

Speaker #5: But what gives us confidence at the end of quarter one is that, with the proactive pricing that we have taken and with the way we are managing our business, and with demand holding on—I'm saying all three conditions—I think we will see a year where we manage our margins quite well, is all I can tell you.

Speaker #5: And I think, of course, our range is known to you, which is 20 to 24. And therefore, from this high which you've seen in this quarter, could it moderate a little bit?

Sudhanshu Vats: I think, of course, our range is known to you, which is 20 to 24, therefore from this high which you have seen in this quarter, could it moderate a little bit? It could moderate a little bit, and it will perhaps moderate a little bit, but it will moderate a little bit. I am saying that's the point. As we stay to the range which we talked about, therefore, that's something I can tell you.

Speaker #5: It could moderate a little bit. And it will perhaps moderate a little bit. But it will moderate a little bit. I'm saying that's the point.

Speaker #5: So we stay within the range which we talked about, and therefore, you know, that's something I can tell you.

Speaker #4: And also, Arnav, if I may add, I think the right way to look at our margin is not on a quarter-to-quarter basis, because the quarter will have many variables.

Kavinder Singh: Also, Arnab, if I may add, I think the right way to look at our margin is not on a quarter-to-quarter basis, because a quarter will have many variables. Some will play out favorably, some may not play out favorably. The fact that I think Sudhanshu mentioned is that 100 is obviously the benefit that we got in Q1 of consuming lower price inventory. That benefit will unravel in Q2 because we have bought inventory or materials at higher prices than what prevail today. Some of it will come as the inventory gets consumed in Q2. If you look at a normalized H1, I would not say there is any major concern on that.

Speaker #4: Some will play out favorably, some may not play out favorably. But the fact that I think Sudhanshu mentioned is that 100 is obviously the benefit that we got in the first quarter of consuming lower-priced inventory.

Speaker #4: That benefit will unravel in the second quarter because we have bought inventory and our materials at higher prices than what prevails today. So, some of it will come as the inventory gets consumed in the second quarter.

Speaker #4: But if you look at a normalized H1, I would not say there is any major concern on that.

Speaker #5: Yeah, absolutely.

Sudhanshu Vats: Yeah, absolutely.

Speaker #4: Got it. Very, very helpful. Thanks so much. All the best.

Arnab Mitra: Got it. Very helpful. Thanks so much. All the best.

Speaker #5: Yeah.

Speaker #2: Thank you, sir. Ladies and gentlemen, in order to ensure that management is able to address questions from all participants on the conference call, please limit your questions to two per participant.

Operator 2: Thank you, sir. Ladies and gentlemen, in order to ensure that management is able to address questions from all the participants in the conference call, please limit your question to two per participant. The next question is from the line of Rahul Maheshwari from Amit Investment Advisors Private Limited. Please proceed with your question.

Operator: Thank you, sir. Ladies and gentlemen, in order to ensure that management is able to address questions from all the participants in the conference call, please limit your question to two per participant. The next question is from the line of Rahul Maheshwari from Amit Investment Advisors Private Limited. Please proceed with your question.

Speaker #2: The next question is from the line of Rahul Maheshwari from Ambit Investment Advisors Private Limited. Please proceed with your question.

Speaker #4: Good evening to the entire team, and first of all, congratulations on an excellent execution on a consistent basis. I have two questions. First, among the Core, Growth, and Pioneer categories, can you share directionally how these three categories have grown?

Rahul Maheshwari: Good evening to the entire team, and first of all, congratulations on excellent execution on a consistent basis. My two questions. First, among the core growth and pioneer categories, can you give directionally that how these three categories have grown? Also within the categories, any few categories which are moving up the curve will be very helpful. This is on first. Second, also on the distribution, how the distribution expansion is taking place and what is the trajectory? Thank you.

Speaker #4: And also, within the categories, any few categories which are moving up the curve will be very helpful. This is on first and second. Also, on the distribution, how the distribution expansion is taking place and what is the trajectory?

Speaker #4: Thank you.

Speaker #5: Yeah, no. Raul, thanks for the compliment and good question. I think as far as our core businesses are concerned, we are basically seeing steady growth on core.

Sudhanshu Vats: Yeah. No, Rahul, thanks for the compliment and good question. I think as far as our core businesses are concerned, we are basically seeing steady growth on core. You know we sort of talk about 1X to 2X GDP. I think we are seeing that in our core businesses. I think what we are beginning to notice, and I'm saying we talked about it in last quarter as well, and this quarter again, and Kamdar alluded to it in context of Roff. I think for our growth businesses, particularly Dr. Fixit, Roff, even our projects business, if you look at Pidilite Projects Group and others, some of our other growth businesses, we are seeing accelerated momentum. I'm saying so that's good news. We are in the range of that 2X to 4X, but we are seeing accelerated momentum in the underlying volume growth in some of our categories.

Speaker #5: And you know, we sort of talk about 1x to 2x GDP. So I think we are seeing that in our core businesses. I think what we are beginning to notice—and I'm saying we talked about it last quarter as well, and this quarter again, and Kavitha alluded to it in the context of ROC—I think, for our growth businesses, particularly Dr. Fixit, ROC, even our projects business, if you look at Pidilite Projects Group and some of our other growth businesses, we are seeing accelerated momentum.

Speaker #5: I'm saying, so that's good news. We are in the range of that 2x to 4x, but we are seeing accelerated momentum in the underlying volume growth in some of our categories.

Sudhanshu Vats: I'm saying so that's good news. We are in the range of that 2X to 4X, but we are seeing accelerated momentum in the underlying volume growth in some of our categories.

Speaker #5: And I think we've spoken about it many times, Raul, but in the interest of once again explaining to people that when we talk of underlying volume growth, we are not talking about total volume growth.

Sudhanshu Vats: I think we've spoken about it many times, Rahul, but in the interest of once again explaining to people that when we talk of Underlying Volume Growth, we are not talking of volume growth, total volume growth. Our total volume growths tend to be much higher than the Underlying Volume Growth. Most of the companies talk of volume growth, simple total volume growth. I think therefore our momentum is strong, and I think that continues. Therefore, as far as core growth ratios are concerned, and we've talked about it, we are in that relatively sweet spot of about nearly 50/50, but I think that's the way it will sort of maintain as we go forward, and I think that's the beat which is good for us. I hope I've answered your question. Was there a follow-up question as well? I think you covered both of them.

Speaker #5: Our total volume growth tends to be much higher than the underlying volume growth. Most companies talk about volume growth as simple total volume growth.

Speaker #5: So, I think, therefore, our momentum is strong, and I think that continues. So, therefore, as far as core growth ratios are concerned, we've talked about it.

Sudhanshu Vats: Therefore, as far as core growth ratios are concerned, and we've talked about it, we are in that relatively sweet spot of about nearly 50/50, but I think that's the way it will sort of maintain as we go forward, and I think that's the beat which is good for us. I hope I've answered your question. Was there a follow-up question as well? I think you covered both of them.

Speaker #5: We are in that relatively sweet spot of about nearly 50-50. But I think that's the way it will sort of maintain as we go forward.

Speaker #5: And I think that's the piece which is good for us. So I think that's the—I hope I've answered your question. Was there a follow-up question as well?

Speaker #5: I think you've covered both of them.

Rahul Maheshwari: Yeah. The follow-up question was that last time when we met, you told Unovin, the render is one of the most disruptive category and the product by your end. Can you just sum brief about Unovin, how it's doing, and are we up to the mark of INR 100 crore business?

Speaker #4: Yeah, yeah. The follow-up question was that last time when we met, you told Unofin the vendor is one of the most disruptive categories, and the product by your end.

Speaker #4: Can you give some brief about Unofin—how it's going there? And are we up to the mark of 100 crore business?

Speaker #5: Yeah, so it's progressing well. Let me again ask Kavitha to talk to you a little bit about Unofin and add more color to it.

Sudhanshu Vats: Yeah. It's progressing well. Let me again ask Kamdar to talk to you a little bit about Unovin and add more color to it.

Speaker #4: So yeah, Unofin,

Kavinder Singh: Yeah. Unovin, again, is a product which comes out of our joint venture with a Spanish company. The good news that I want to share with you is that we are beginning to see green shoots in the Unovin side of the business. We have been working with almost for a year plus, actually even more, to get, let's say, specified as well as accepted amongst the architects who are looking for newer finishes for their projects. We are seeing acceptance in commercial projects, high-end residential projects. We are beginning to have some big names. Of course, I can't take the names of the architects who are now beginning to recommend Unovin and because there is a possibility to have this product has this unique advantage of giving us approximately 15 years of waterproofing as well as no repainting cycle needed, plus sprayable technology.

Speaker #5: Again, this is a product which comes out of our joint venture with a Spanish company. So, the good news that I want to share with you is that we are beginning to see green shoots on the Unofin side of the business.

Speaker #5: We are beginning to get—we have been working with them for almost a year plus, actually even more—to get, let's say, specified as well as accepted amongst the architects who are looking for newer finishes for their projects.

Speaker #5: We are seeing acceptance in commercial projects and high-end residential projects. So we are beginning to have some big names—of course, I can't take the names of the architects—who are now beginning to recommend Unofin. Because there is a possibility to have this product, it has this unique advantage of giving us approximately 15 years of waterproofing as well as no repainting cycle needed. Plus, with sprayable technology, there are these nuances which are now beginning to get accepted in the market.

Kavinder Singh: We are beginning to have some big names. Of course, I can't take the names of the architects who are now beginning to recommend Unovin and because there is a possibility to have this product has this unique advantage of giving us approximately 15 years of waterproofing as well as no repainting cycle needed, plus sprayable technology.

Kavinder Singh: There are these nuances which are now beginning to get accepted in the market. Still, I would say early days, but there is momentum that we are seeing. We have also reorganized our sales and go-to-market strategy, going through the architects through our Pidilite Professional Solutions group. We have a projects group which is going out and selling it to the various segments. There is a lot of work that we have done at the back end, including training

Speaker #5: Still, I would say it's early days, but there is momentum that we are seeing. We have also reorganized our sales and go-to-market strategy, going through the architects and through our Pidilite Professional Solutions Group.

Speaker #5: And we have a Projects group, which is going out and selling it to the various segments. So, there is a lot of work that we have done at the back end, including training.

Speaker #5: We have also reformulated the product for cost efficiency. So, we believe that we are now on the right track, and we expect to see more momentum.

Sudhanshu Vats: Also reformulated the product also for cost efficiency. We believe that we are now on the right track, and we will see some more momentum. Yes, coming back to your question on whether it's INR 100 crore in three years or not. I would not comment on the number. We are right now focused on building the base. Yes, sometime around next year, maybe we can see whether the green shoots that we are seeing are actually prospering and moving forward, and then we can look at numbers. Internally, we believe that this product and the proposition has reasonably good potential and a good proposition. We continue to be at it. Like in typical Pidilite style, we do not give up easily. We keep working closely with the relevant stakeholders, and that's exactly the playbook we are again deploying in the case of Funofit. Thank you.

Kavinder Singh: Also reformulated the product also for cost efficiency. We believe that we are now on the right track, and we will see some more momentum. Yes, coming back to your question on whether it's INR 100 crore in three years or not. I would not comment on the number. We are right now focused on building the base. Yes, sometime around next year, maybe we can see whether the green shoots that we are seeing are actually prospering and moving forward, and then we can look at numbers.

Speaker #5: Yes, coming back to your question on whether it's ₹100 crore in three years or not. I would not comment on the number. We are right now focused on building the base and, yes, sometime around next year, maybe we can see whether the green shoots that we are seeing are actually prospering and moving forward.

Speaker #5: And then we can look at numbers. Internally, we believe that this product and the proposition have reasonably good potential and a good proposition, so we continue to be at it.

Kavinder Singh: Internally, we believe that this product and the proposition has reasonably good potential and a good proposition. We continue to be at it. Like in typical Pidilite style, we do not give up easily. We keep working closely with the relevant stakeholders, and that's exactly the playbook we are again deploying in the case of Funofit. Thank you.

Speaker #5: As is typical of Pidilite, we do not give up easily. We keep working closely with the relevant stakeholders, and that's exactly the playbook we are deploying again in the case of Unofin.

Speaker #5: Thank you.

Rahul Maheshwari: Actually, just last one is distribution expansion-

Speaker #4: That's very helpful. Just one last thing before we expand.

Rahul Maheshwari: Actually, just last one is distribution expansion-

Operator 2: Sorry to interrupt, Rahul, sir. May we request that you retract your question? Follow-up?

Operator: Sorry to interrupt, Rahul, sir. May we request that you retract your question? Follow-up?

Speaker #6: Sorry to interrupt. Raul, sir, may I request that you return to your question? Caller.

Speaker #4: Okay.

Rahul Maheshwari: Okay.

Speaker #6: Thank you, sir. The next question is from the line of Lathika Chopra from JP Morgan. Please proceed with your question.

Operator 2: Thank you, sir. The next question is on the line of Latika Chopra from JP Morgan. Please proceed with your question.

Operator: Thank you, sir. The next question is on the line of Latika Chopra from JP Morgan. Please proceed with your question.

Speaker #4: Thank you. Hi, team. Always good to see robust performance from you. My first question is just to better understand the cumulative price increases that you have taken for the Consumer and Bazaar segment.

Latika Chopra: Thank you. Hi, team. Always good to see a robust performance from you. My first question was just trying to understand better the cumulative price increases that you have taken for Consumer and Bazaar segments. It seems in the quarter you had a weighted price increase of close to 10%. Is this number going to sustain in Q2 or you are going to see a lagged impact of some pricing interventions that you took during through the quarter and hence the pricing component increases as we move into Q2, Q3?

Speaker #4: It seems, in the quarter, you had a weighted price increase of close to 10%. Is this number going to sustain in Q2, or will you see a lagged impact of some pricing interventions that you took during the quarter, and hence the pricing component increases as we move into Q2 and Q3?

Speaker #5: Yeah. Lathika, I think first of all, always great to hear from you. Thank you. I think on pricing, Lathika, two, three things. I think one is that we've taken prices in consumer and bazaar, and they vary by category and they vary by brand.

Sudhanshu Vats: Yeah. Latika, first of all, always great to hear from you. Thank you. On pricing, there are two, three things. One is that we've taken prices in Consumer and Bazaar, and they vary by category and they vary by brand. The range is pretty wide. It could go from, let's say, a 2% to about a 12%, to be fair. Some of it has a component of the time-weighted component. Therefore, it all didn't go on April 1, to just put it in perspective. To that extent, you're right that some of that additional impact should come in Q2 and therefore in Q3 as well.

Speaker #5: So I think they are, and you know, the range is pretty wide. It could go from, let's say, 2% to about 12%, to be fair.

Speaker #5: And some of it had the component of the, you know, time-weighted component. So therefore, you know, it all didn't go on April 1st. To just put it in perspective.

Speaker #5: So to that extent, you're right that some of that additional impact should come in Q2 and therefore in Q3 as well. But as you would remember, I'm saying, if you've been on the call, there was another gentleman who asked this question on, you know, with the fluctuating raw material, there could be some rebates passed on, particularly in our bazaar business, to be— to play the more win-win and a more fair play.

Sudhanshu Vats: As you would remember, if you've been on the call, there was another gentleman who asked this question on, with the fluctuating raw material, there could be some rebates passed on, particularly in our Bazaar business to play the more win-win and a more fair play. It's quite dynamic, Latika. My sense is it's not so straightforward that you put those prices in, and then everything else is constant, and therefore this quarter you should get the full time-weighted advantage of it. Yes, time-weighted advantage we'll get, but with the movement in VAM, if you remember one of the questions which was asked. We are, and we would be passing a little bit of rebate in that area. It is also possible with movement in some other raw materials, because it's been really volatile.

Speaker #5: So it's quite dynamic, Lathika. My sense is that it's not so straightforward that you put those prices in and then everything else is constant, and therefore this quarter you should get the full time-weighted advantage of it.

Speaker #5: So yes, we will. We’ll get our time-weighted advantage. But with the movement in VAM, if you remember, one of the questions that was asked—we are, and we would be, passing a little bit of rebate in that area.

Speaker #5: It is also possible with movement in some other raw materials because it's been really volatile, as you know, Lathika. I'm saying crude at $100, back to crude at $80.

Sudhanshu Vats: As you know, Latika, I'm saying crude at 100, back to crude at 80. From crude, I can at least tell you. It's fluctuating week on week, so it's so volatile, and therefore, at what price you picked up, what is happening. Overall also, commodity is quite volatile. This kind of volatility, I think is very unprecedented in my opinion. I'm saying, partly caused by ourselves, all of us. I'm saying as in the geopolitical situation. To answer your question, yes, there could be theoretically a time-weighted advantage of this, but it may get nullified with some of the rebates and other movements.

Speaker #5: I can, from crude, I can at least tell you, and you know, it's fluctuating week on week. So it's so volatile, and therefore, you know, in what price you picked up, what is happening.

Speaker #5: Overall, also, commodity is quite volatile. It's this kind of volatility, I think, that is very unprecedented, in my opinion. I'm saying, you know, it's partly caused by ourselves—all of us.

Speaker #5: I'm saying, as in during the geopolitical situation. So I think my view is that, to answer your question, yes, there could be, theoretically, a time-weighted advantage to this, but it may get nullified with some of the rebates and other movements.

Speaker #4: Understood. And the second question was—you've already touched upon some of the core businesses and how they're doing, but I just wanted to get from you any updated thoughts on progress with your forays into electronic investors in Spain?

Latika Chopra: Understood. The second question was, you've already touched upon some of the core businesses and how they're doing, but just wanted to get from you any updated thoughts on progress on your forays into electronics and paints. Anything incremental that you'd want to share? Thank you.

Speaker #4: Anything incremental that you'd want to share? Thank you.

Speaker #5: Yeah, yeah. So, on electronics business and overall, I'm saying, so therefore as we look at electronics and as we look at additional sectors of electronics, we are beginning to make more progress.

Sudhanshu Vats: On electronics business and overall, I'm saying, as we look at electronics and as we look at additional sectors of electronics, we are beginning to make more progress. I can share with you, I think our emphasis initially was more consumer electronics. We are also looking at auto EV, and that is becoming more and more paced there. I think the full gamut of electronics as we understand, I think we are beginning to do a lot of work in that space. We are beginning to see some initial round of one or two places, even some commercial pitches coming up. There is always a lag in specification. Making good progress on that, I can tell you very clearly.

Speaker #5: I can share with you. I think our emphasis initially was more on consumer electronics. We are also looking at auto, auto, EV, and, you know, as that is becoming more and more there.

Speaker #5: And I think so, therefore, the full gamut of electronics as we understand, I think we are beginning to do a lot of work in that space.

Speaker #5: We are beginning to see some initial rounds in one or two places, even some commercial pieces coming up. But there is always a lag in specifications.

Speaker #5: Making good progress on that. I can tell you very clearly. I think on Spain, as I've always maintained, that in the places we are, I think we are seeing something.

Sudhanshu Vats: I think on paints, I think as I've always maintained that in the places we are, I think we are seeing something, but we are still not confident of our full playbook, particularly the urban playbook, which we are refining as we go forward. You will see in future as we go forward, a little bit more acceleration. It's a little bit more calibrated at this moment, I have to say without a doubt.

Speaker #5: But we are still not confident about our full playbook, particularly the urban playbook, which we are—you will see in the future as we go forward—a little bit more acceleration.

Speaker #5: So, it's a little bit more calibrated at this moment, if I could say without doubt.

Speaker #4: Good. Thank you so much. Wish you the best.

Latika Chopra: Got you. Thank you so much, wish you the best.

Speaker #5: Thank you.

Sudhanshu Vats: Thank you.

Speaker #6: Thank you. Thank you, ma'am. The next question is from the line of Ranjit S. from Avendus Park Institutional Equities. Please proceed with your question.

Operator 2: Thank you. Thank you, ma'am. The next question is from the line of Ranjeet S from Avendus Spark Institutional Equities. Please proceed with your question.

Operator: Thank you. Thank you, ma'am. The next question is from the line of Ranjeet S from Avendus Spark Institutional Equities. Please proceed with your question.

Speaker #4: Hi, sir. Thanks for the opportunity.

[Company Representative] (Spark Institutional Equities): Hi, sir. Thanks for the opportunity. This is Tejas from Spark, Avendus Spark. Sir, first of all, congrats on super set of numbers. Just wanted to know that in a quarter which was so volatile on pricing, should we see this as a validation of consumer behavior also kind of being so robust? It could be mix of that. There can be some pre-buying from channels and hence it can't be seen or should not be seen as that at consumer optic level also it will be this robust. Just wanted your opinion or view on this.

[Analyst] (Avendus Spark Institutional Equities): Hi, sir. Thanks for the opportunity. This is Tejas from Spark, Avendus Spark. Sir, first of all, congrats on super set of numbers. Just wanted to know that in a quarter which was so volatile on pricing, should we see this as a validation of consumer behavior also kind of being so robust? It could be mix of that. There can be some pre-buying from channels and hence it can't be seen or should not be seen as that at consumer optic level also it will be this robust. Just wanted your opinion or view on this.

Speaker #7: This is Pages from SPARC, Avendus Park. Sir, first of all, congrats on a superb set of numbers. I just wanted to know, in a quarter which was so volatile on pricing, should we see this as a validation of consumer behavior also being so robust?

Speaker #7: Or it could be a mix of that; there can be some pre-buying from channels, and hence, it can't be seen—or should not be seen—as though consumer off-take at the retail level is also this robust.

Speaker #7: Just wanted your view on this.

Speaker #5: I think, first of all, good to hear from you. I think, from a—we talked about this in the context of Consumer and Bazaar UVT.

Sudhanshu Vats: I think, Tejas, first of all, good to hear from you. We talked about this in the context of consumer and bazaar UVG. I would say that the behavior is very robust. I think in the quarter that has gone by, because this is a quarter of calibrated but multiple price increases, could there have been a little bit more of stocking? Perhaps, yes. If I look at aggregate numbers, I would say the demand is steady, and we talked about it earlier as well. I would say we are seeing the right progression in particularly in our Consumer and Bazaar business on underlying volume growth. I would say that all things being equal, that should continue as we go forward.

Speaker #5: I would say that the behavior is very robust. I think, in the quarter that has gone by—because it was a quarter of calibrated but multiple price increases—could there have been a little bit more upstocking? Perhaps, yes. But if I look at aggregate numbers, I wouldn't—I would say the demand is steady, and we talked about it earlier as well.

Speaker #5: I would say we are seeing the right progression, particularly in our Consumer and Bazaar business, on underlying volume growth. And I would say that, all things being equal, that should continue as we go forward.

Speaker #7: Perfect. And sir, we had seen such a cycle in the past in 2009-11, when there was a sharp inflation followed by deflation, and if my memory serves me right, we used the cycle to seed many new growth engines.

[Company Representative] (Spark Institutional Equities): Perfect. Sir, we had seen such a cycle in past in 2009, 2011, when there was a sharp inflation followed by deflation. If my memory serves me right, we used the cycle to seed many new growth engines. At this point when we are at upper end of our margin guidance also, let's say if we had to face deflation again, how would you prioritize to use the extra margin? Will it be to protect the core and go more intense there, or you will expand the pioneer portfolio by adding more engines of growth for future?

[Analyst] (Avendus Spark Institutional Equities): Perfect. Sir, we had seen such a cycle in past in 2009, 2011, when there was a sharp inflation followed by deflation. If my memory serves me right, we used the cycle to seed many new growth engines. At this point when we are at upper end of our margin guidance also, let's say if we had to face deflation again, how would you prioritize to use the extra margin? Will it be to protect the core and go more intense there, or you will expand the pioneer portfolio by adding more engines of growth for future?

Speaker #7: So at this point, when we are at the upper end of our margin guidance also, let's say if we had to face deflation again, how would you prioritize to use the extra margin?

Speaker #7: Will it be to kind of protect the core and go more intense there, or will you kind of expand the Pioneer portfolio by adding more engines of growth for the future?

Speaker #5: So I think, Paresh, that's a very good question. I think we find a balance. But as you know, like philosophy, so we are, and we take that as well.

Sudhanshu Vats: I think, Tejas, that's a very good question. I think we find a balance, but as you know, Pidilite philosophy, we state that as well, that we are pioneering. We continue to look at newer opportunities, and Kavinder spoke about a couple of them in some detail in this call also. In general, I think you know that we are looking at some of the other electronics and industrial pieces. There is work which we are doing on multiple fronts, Tejas, none of this can be specifically spoken about in the call, but I can tell you that as a company, our philosophy is to continue to do pioneering work to find the right usage of the margins and capital or money that we generate. I think we are at it.

Speaker #5: So we are pioneering, so we continue to look at newer opportunities. And, you know, Karinder spoke about a couple of them in some detail in this call also.

Speaker #5: But in general, and I think you know that, we are looking at some of the other electronics and industrial pieces. So there is work which we are doing on multiple fronts, pages.

Speaker #5: And none of this can be specifically spoken about on the call. But I can tell you that, as a company, our philosophy is to continue to do pioneering work to find the right usage of the margins and capital, or money, that we generate.

Speaker #5: And I think we are at it. I think Sandeep and all of us as a team are basically—well, you will hear more of it when it is something we can talk about, and we will definitely talk about that.

Sudhanshu Vats: I think Sandeep and all of us as a team, you will hear more of it when it is something we can talk about, we will definitely talk about that.

Speaker #7: Thanks, and all the best for coming forward with this.

[Company Representative] (Spark Institutional Equities): Thanks, all the best for coming quarters.

[Analyst] (Avendus Spark Institutional Equities): Thanks, all the best for coming quarters.

Speaker #5: Thank you.

Sudhanshu Vats: Thank you.

Speaker #6: Thanks. Thank you, sir. The next question is from the line of Bharat Seth from Quest Investment Advisors Private Limited. Please proceed with your question.

Operator 2: Thank you, sir. The next question is from the line of Bharat Sheth from Quest Investment Advisors Private Limited. Please proceed with your question.

Operator: Thank you, sir. The next question is from the line of Bharat Sheth from Quest Investment Advisors Private Limited. Please proceed with your question.

Bharat Sheth: Hi, Sudhanshu, Kavinder, and Sandip. Congratulations on good set of numbers in challenging time. Sir, my question is related to tile fixing. We introduced chemical a few years back, now it has become a kind of a core category kind of a thing. The underlying business dynamics are also changing. People are adopting more new practices in India, simultaneous as well we are also not being over electronic chemical we are introducing. If I have to understand, Kavinder also stated within our tile fixing premium. Premium over a period becomes a kind of general acceptance. How do we understand the way we are doing business and continuously introducing new categories?

Speaker #4: Hi. Thank you. And Karinder and Sandeep, congratulations on good set of number in challenging time. Sir, my question is related to like say time fixing we introduced chemical a few years back and then now it has become a kind of a core category kind of a thing.

Speaker #4: So the underlying— I mean, business dynamics are also changing. People are adopting more new practices in India. And simultaneously, as well as, we are also, like, you know, in our electronic chemicals, we are introducing—.

Speaker #4: So, if I have to understand—I mean, like Karinder also stated—within a tight pricing, I mean premium, so premiumization over a period then becomes a kind of general acceptance.

Speaker #4: So, how do we understand the way we are doing business and continuously introducing new categories?

Speaker #5: So first of all, thank you for the compliments and now you have seen the numbers in the zone which we have spoken about. I think the point is that these are all so these are things which we do continuously and unfortunately we don't we first walk the walk and then talk that walk at an appropriate time.

Sudhanshu Vats: Bharat, first of all, thank you for the compliments and now you have seen the numbers in the zone which we have spoken about. I think the point is that these are things which we do continuously, unfortunately, we first walk the walk and then talk that walk at an appropriate time. I think that's the way it should be in our judgment as well. I think there are multiple things which we will keep doing. Some of them will grow faster, some of them will grow into bigger. Bharat, one thing I do want to tell you is that even in what you are saying that Roff has been around for some time, there is a lot of growth opportunity in Roff.

Speaker #5: And I think that's the way it should be, in our judgment as well. So, I think there are multiple things that we will keep doing.

Speaker #5: Some of them will grow faster some of them will grow into bigger but one thing I wanted to do I do want to tell you is that even in what you are saying that ROF has been around for some time there is a lot of growth opportunity in ROF and as you know we pointed out as well earlier in the call the momentum is continuing if at all picking up a little bit more.

Sudhanshu Vats: As you know, we pointed out as well earlier in the call, the momentum is continuing, if at all, picking up a little bit more. Even in our growth categories, which are now around for some time, and that's what you meant. There is a lot of growth opportunity which is there. We will continue to look at newer things, but the momentum on our growth categories is strong, we feel that there is a lot to be done in that space as well.

Speaker #5: So even in our growth categories which are now around for some time in your and that's what you meant after your उसमें भी अभी there is a lot of growth opportunity which is there.

Speaker #5: So, we will continue to look at newer things, but there is a lot in our—the momentum on our growth categories is strong, and we feel that there is a lot to be done in that space as well.

Speaker #4: So, I mean, to understand a little more on this, is this changing the consumer pattern or underlying customer pattern? So, how is this one side competition as well, but how do we see the team is growing faster than the competition, or how do we understand it from, say, a two to three years perspective?

Bharat Sheth: To understand little more on this changing consumer behavior pattern, consumer or underlying customer pattern. Inside competition is also there, but how do we see that Pidilite is growing faster than the competition, or how we understand it from a, say, two, three years perspective?

Speaker #5: Yeah, no. So we measure this, but I think—so basically, we know how much the market is growing by. We know that very well.

Sudhanshu Vats: We measure this. I think basically, we know how much is the market growing by. We know that very well. We have a sense of what the other players are growing by. Sometimes they are listed, their numbers are available, but other times we have a good sense. We have a very good listing on our own business. We know market growth and our growth. In some of these categories, our growth is a factor of roughly 1.5x, could even be between 1.5 to 2x, if I could use the word, if I could give the factor of the market growth, that is clearly market share accretive. Very clearly market share accretive. We are gaining market share in a rapidly growing market, there is competition coming in at some question which came in earlier as well.

Speaker #5: We have a sense of what the other players are growing by. Sometimes their numbers are available, but at other times, we just have a good sense. But we have a very good understanding of this thing in our own business.

Speaker #5: So we know market growth and our growth and in some of these categories our growth is factor of you know so between 1.5x could even be between 1.5 to 2x if I could use the word of the market growth of the of the if I could give the factor of the market growth and that is clearly market share accredited very clearly market share accredited.

Speaker #5: So we are gaining market share in a rapidly growing market, and there is competition coming in—a question which came in earlier as well.

Speaker #5: We responded to it. But I think we are basically continuing to grow market share in growing categories, and because of the way we do business, I think that's the piece.

Sudhanshu Vats: We responded to it, Kavinder. I think we are basically continuing to grow market share in growing categories. Because the way we do business, I think that's the piece. I'll ask a little bit of further detail.

Speaker #5: I'll ask a little bit further on your question, specifically on, you know, we started, others have come in, etc., etc., and even in Onofin. How do we think about the size, because players will come in?

Kavinder Singh: Yeah. Bharat, your question specifically on, we started tile adhesives, others have come in, et cetera. Even in Unocin, how do we think about the size? Players will come in. See, just to give you a sense, the penetration of tile adhesives in India is still not more than 25%, at best 30%. The room for growth exists for all players. We can only confirm that we are growing fastest amongst all the players, which means we are gaining share in a fast-growing category. Fundamentally, even though there will be other players that will come in, the size of opportunity is big and competition is good because it keeps us obviously sharp. What we are trying to do is continuously, as I mentioned earlier, work very closely with the contractors, the tile channel, and also build our plant network.

Speaker #5: Just to give you a sense, the penetration of tile adhesives in India is still not more than 30%. So the room for growth exists for all players.

Speaker #5: We can only confirm that we are growing the fastest amongst all the players, which means we are gaining share in a fast-growing category. So, fundamentally, even though there will be other players that will come in, the size of the opportunity is big, and competition is good because it keeps us obviously sharp. What we are trying to do is continuously, as I mentioned earlier, work very closely with the contractors, the tile channel, and also build our plant network.

Speaker #5: Among responding to the tile piece and building the total delivered cost in a manner that we remain competitive, it's a combination that will eventually win in the marketplace. We remain humble enough to admit that we are also learning every day, and our approach will be not to give up the advantage that we have.

Kavinder Singh: I'm only responding to the tile piece. Build the total delivered cost in a manner that we remain competitive. It's a combination that will eventually win in the marketplace, and we remain humble enough to admit that we are also learning every day, and our approach will be not to give up the advantage that we have, in fact, increase that. The good news is that the penetration is low, so there is room for people to grow, and we should not be worried too much about the new competition coming in. As long as we are able to penetrate and expand the category, and almost as a leader in the category, it's our job to expand the category. Same is true for categories like Unocin and many other categories where we tend to be pioneers.

Speaker #5: In fact increase that and the good news is that the penetration is low. So there is room for people to grow and we should not be worried too much about the new competition coming in as long as we are able to penetrate and expand the category and almost as a leader in the category it's our job to expand the category same is true for people categories like Onofin and many other categories where we tend to be pioneers in some cases we are trying to grow faster than the others in some cases we are pioneering and we are also moving towards a solution approach and that's something that I've said earlier you know with this Pidilite professional solutions in the projects area particularly we are not trying to offer products but actually offer systems and that to my mind is a very big moat we are building for the future where the architects and structural consultants will in a way recommend our systems because the systems together can perform better than an individual product.

Kavinder Singh: In some cases, we are trying to grow faster than the others. In some cases, we are pioneering, and we are also moving towards a solution approach, and that's something that I've said earlier. With this Pidilite Professional Solutions in the projects area particularly, we are not trying to offer products but actually offer systems. That, to my mind, is a very big moat we are building for the future, where the architects and structural consultants will, in a way, recommend our systems because the systems together can perform better than an individual product. There are multiple levers we are pressing to remain ahead of the curve, even in a highly competitive but under-penetrated category.

Speaker #5: So, there are multiple levers we are pressing to remain ahead of the curve, even in a highly competitive but underpenetrated category.

Speaker #4: Thank you. Thank you. And with your permission, may I ask one further question?

Bharat Sheth: Thank you, Kohir. Thank you. Shridhar, with your permission, one question may I further ask?

Speaker #5: Go ahead. Go ahead.

Sudhanshu Vats: Go ahead, Bharat.

Speaker #4: Simon, can you say, like in our original category-wise view, what we are seeing is that competition is already picking up, but simultaneously, several imply manufacturing has started supplying pre-laminated ply also. So, do we see those kind of the side?

Bharat Sheth: Simultaneously, I feel like in our original category, white glue, what we are seeing that competition is already picking up, simultaneously, several ply manufacturers have started supplying pre-laminated ply also. Do we see that those kind of de-growth can happen in the consumption side?

Speaker #5: I mean, we actually see the contrary. See, क्या है कि हर चीज it's so under-indexed in India, even now. I'm saying across the board, so if you look at 2025, more recent innovation—so, I'm saying whether it is multilock—so multilock, basically what is happening is there are multiple types of materials which are coming into home construction now.

Sudhanshu Vats: No, Bharat, we actually see the contrary. See, it's so under-indexed in India even now, I'm saying across the board. If you look at two of our more recent innovations, I'm saying whether it is Multilock. Multilock, basically what is happening is, Bharat, there are multiple types of materials which are coming into home construction now. While we use the word ply, it's not only ply. There are multiple types of products that are there. Our Multilock product is doing exceedingly well. We just in the beginning of the call talked about xWork. Our original products which have been around are also continuing to do well. I think the point is that we have to continuously innovate, do the right thing, find the right solutions for the right products, and we will continue to grow.

Speaker #5: So, while we use the word 'ply', it's not only 'ply'—there are multiple types of products that are there. So, our Multilock product is doing exceedingly well.

Speaker #5: We just, in the beginning of the call, talked about how our expert and our original products, which have been around, are also continuing to do well.

Speaker #5: So I think the point is that I we have to continuously innovate do the right thing find the right solutions for the right products and and we will be we will continue to grow.

Speaker #5: And mind you, we have a joineries business in our Fevicol division as well, which continues to grow faster than our core Fevicol retail business. And the joineries business is where we captured some of these opportunities—where you talk about pre-laminated or, you know, prefabricated kind of stuff.

Sudhanshu Vats: Mind you, Bharat, we have a joineries business in our Fevicol Division as well, which continues to grow faster than our core Fevicol retail business. Joineries business is where we capture some of these opportunities where you talk about pre-laminated or you talk about prefabricated kind of stuff. Our joineries business is very robust and that is doing really well.

Speaker #5: So our joineries business is very robust, and that's doing really well.

Speaker #4: Okay. Thank you, and all the best.

Bharat Sheth: Okay. Thank you and all the best, sir.

Speaker #5: Thank you.

Sudhanshu Vats: Thank you.

Speaker #4: Thank you. Thank you, sir. Ladies and gentlemen, in order to ensure that management is able to address questions from all the participants on the conference call, please limit your questions to two per participant.

Operator 2: Thank you, sir. Ladies and gentlemen, in order to ensure that management is able to address questions from all the participants in the conference call, please limit your question to two per participant. The next question is from the line of Sid Gandhi from IIFL Capital. Please proceed with your question.

Operator: Thank you, sir. Ladies and gentlemen, in order to ensure that management is able to address questions from all the participants in the conference call, please limit your question to two per participant. The next question is from the line of Sid Gandhi from IIFL Capital. Please proceed with your question.

Speaker #4: The next question is from the line of Sidh Gandhi from IIFL Capital. Please proceed with your question. Hi, sir. Sidh here. My question is again on margins.

Percy Panthaki: Hi, sir. This is Percy Panthaki here. My question is again on margins. See, when the war broke out and at the beginning of Q1, possibly the sort of expectation was that this year might be towards the lower end of the 20% to 24% margin because of the cost inflation. Now, this quarter you have done 26% margin. Would it be fair to say that if crude and related commodities maintain at, let's say, somewhere in the mid-80s, you would actually be at the higher end of the margin this year?

Speaker #4: See, when the war broke out and at the beginning of Q1, possibly the sort of expectation was that this year might be towards the lower end of the 20% to 24% margin because of the cost inflation.

Speaker #4: This quarter, you have done a 26% margin. Would it be fair to say that if crude and related commodities maintain at, let's say, somewhere in the mid-80s, then you would actually be at the higher end of the margin this year?

Speaker #5: Yeah, but see, I think maybe Sandeep can also add a quick point. But let me, in the interest of time, very quickly respond to you.

Sudhanshu Vats: Yeah, Percy, I think maybe Sandeep can also add a quick bit, but let me, I think in the interest of time, very quickly respond to you. I think the thing here is, I think first of all, don't look at it quarter to quarter. I think that's the point he made as well. I think Q1 tends to be the biggest quarter. It does give you the leverage and all that stuff. The way we have managed our pricing and the way we have executed. If some of the things, there's an if, and I'll say IF.

Speaker #5: I think the thing here is, first of all, don't look at it quarter to quarter. I think that's the point he made as well.

Speaker #5: I think quarter one which is at quarter one tends to be the to the to the biggest the biggest quarter. It does give you the leverage and all that stuff.

Speaker #5: The way we have managed our pricing and the way we have executed if some of the things there is a there is a if and I'll say IF if the if the crude remains as you said and if the volatility is not going to increase and and the you know some situation eases a little bit there you know even if it remains dynamic I think your assumption is correct that we would be we would manage the business well within the band and it is quite possible that we could be and middle to higher end of the band easily.

Sudhanshu Vats: If the crude remains as you've said, if the volatility is not going to increase, some situation eases a little bit, even if it remains dynamic, I think your assumption is correct, that we would manage the business well within the band. It is quite possible that we could be at middle to higher end of the band easily. It's possible. That's why I'm, again, repeating and saying big if. We are going to do the best we can. We have demonstrated again. I think that we will continue to deliver to the best of our capability, both in the quality of execution, speed of execution, agility which we need. I think all that will be there in all aspects of our business.

Speaker #5: It's possible. I'm saying it, but that's why I'm again repeating myself, saying big if, but we are going to do the best we can.

Speaker #5: We have demonstrated again, so I think, and we will continue to, you know, deliver to the best of our capability, both in the quality of execution, speed of execution, agility—which we need.

Speaker #5: I think all of that will be there in all aspects of our business.

Percy Panthaki: Got it. On volume growth, I know you've answered this earlier, but just to get a little more clarity, are we saying that sort of a 9% to 10% volume growth is something that is most likely over, let's say, a 3-year kind of a period, plus or minus on a yearly basis, it might go up or down. Let's say on a medium-term, 3, 4-year basis, 9% to 10% volume growth QVG is what we are looking at?

Speaker #4: Got it. And on volume growth—I mean, I know you have answered this earlier, but just to get a little more clarity, are we saying that sort of a 9% to 10% volume growth is something that is most likely over, let's say, a three-year kind of a period? Plus or minus, on a yearly basis it might go up or down, but let's say on a medium-term, three- to four-year basis, 9% to 10% volume growth UVG is what we are looking at.

Speaker #5: Yeah yeah underlying volume growth as we say which is you know like to like volume and and mix so therefore it's not simple volume growth.

Sudhanshu Vats: Yeah. Underlying volume growth, as we say, which is like to like volume and mix. Therefore, it is not simple volume growth. I think we have always maintained that we will deliver double digits. As a matter of fact, our endeavor will be to slowly but surely inch it up a little bit.

Speaker #5: I think we've always maintained that we will deliver double-digit growth. As a matter of fact, our endeavor will be to slowly but surely inch it up a little bit, and also look at it in the context of the overall GDP growth, because we always index the growth of our categories to a multiple of the real GDP growth.

Percy Panthaki: Yeah, that is all from me.

Sudhanshu Vats: Also, perhaps even look at it in the context of the overall GDP growth, because we always index our growth of our categories to a multiple of the real GDP growth. On the hypothesis that real GDP in India will grow at the 6% to 6.5% range. If you apply the range that we give for our core growth categories, you will end up at a double-digit underlying volume growth.

Sandeep Batra: Also, perhaps even look at it in the context of the overall GDP growth, because we always index our growth of our categories to a multiple of the real GDP growth. On the hypothesis that real GDP in India will grow at the 6% to 6.5% range. If you apply the range that we give for our core growth categories, you will end up at a double-digit underlying volume growth.

Speaker #5: So on the hypothesis that you know real GDP in India will grow at the six six and a half percent range if you apply the range that we give for our core growth categories you will end up at a at a double digit underlying volume growth.

Percy Panthaki: Got it. That is all from me. Thanks, and all the best.

Speaker #4: Got it. Got it. That's all from me. Thanks, and all the best.

Speaker #1: Thank you, sir. The next question is from the line of Prateek from HSBC. Please proceed with your question.

Operator 2: Thank you, sir. The next question is on the line of Sadiq from HSBC. Please proceed with your question.

Operator: Thank you, sir. The next question is on the line of Sadiq from HSBC. Please proceed with your question.

Sadiq Ghouse: Hello, everyone. Am I audible?

[Analyst] (HSBC): Hello, everyone. Am I audible?

Speaker #4: Hello everyone. Am I audible?

Speaker #5: Yes yes audible.

Sandeep Batra: Yes.

Sudhanshu Vats: Yes.

Sandeep Batra: Yes, Sadiq, you're audible.

Speaker #4: Thank you for taking my question. This is Prateek Gothi from HSBC. I just have one question. Similar to tile adhesives, can you also throw some light on the waterproofing chemicals space—the rising competitive intensity there and your improving performance in FY26? Any color on demand in FY27 so far, and just the runway for growth like you talked about for the tile business, please.

Sadiq Ghouse: Thank you for taking my question. This is Sadiq Ghouse from HSBC. I just have the one question. Similar to tile adhesives, can you also throw some light on the waterproofing chemicals space, the rising competitive intensity there, and your improving performance in FY26? Any color on demand in FY27 so far, and just the runway for growth, like you talked about for tile adhesives?

[Analyst] (HSBC): Thank you for taking my question. This is Sadiq Ghouse from HSBC. I just have the one question. Similar to tile adhesives, can you also throw some light on the waterproofing chemicals space, the rising competitive intensity there, and your improving performance in FY26? Any color on demand in FY27 so far, and just the runway for growth, like you talked about for tile adhesives?

Speaker #5: Yeah yeah yeah. So we will be basically I'll ask Kavinder to comment more on it but we are making continuously we are sort of this is another category which is growing and it's also picking up the pace.

Sudhanshu Vats: Yeah. We will pick. Basically, I'll ask Kavinder to comment more on it, but we are making continuously, this is another category which is growing, and it's also picking up the pace.

Speaker #5: So yeah, we ended up discussing a lot about tile adhesives, so let's move on to a little bit on waterproofing as you requested.

Kavinder Singh: Yeah. We ended up discussing a lot about tile adhesives, let's move on to a little bit on waterproofing, as you requested. See, Dr. Fixit as a brand in the retail segment is by far the most powerful brand with regards to waterproofing solutions. In fact, our brand promise is waterproofing expert, and that is something that we are beginning to see again, momentum in this category. There are multiple actually solutions in this category. There are solutions which are around improving the performance of concrete. There are solutions about how to do the waterproofing in a manner where no leakage will happen. As you know, this is one area where a skilled applicator is critical. What we have been doing is, again, our playbook is to create large set of trained applicators. We have training centers.

Speaker #5: See, Dr. Fixit as a brand in the retail segment is by far the most powerful brand with regard to waterproofing solutions. In fact, our brand promise is 'waterproofing expert,' and that is something where we are beginning to see, again, momentum in this category.

Speaker #5: There are multiple actual solutions in this category. There are solutions which are around improving the performance of concrete. There are solutions about how to do the waterproofing in a manner where no leakage will happen, and as you know, this is one area where a skilled applicator is critical.

Speaker #5: So what we have been doing is again our playbook is to create large set of trained applicators we have training centers we are investing behind them and ensuring that our pool of trained applicators grows on the other hand we are also making significant inroads on the project side of waterproofing we have we are now tapping into multiple segments whether residential commercial hotels etc as you know the construction is still doing well in our country so we have Pidilite professional solutions which has a construction solution group which is focused on working with architects and structural consultants to get ourselves specified our systems are now getting specified not just the products and this is helping us to build momentum in the projects business as Subhanshu also mentioned earlier even in retail the waterproofing piece you know in retail as I said there are product categories which are around improving the concrete performance which is different kind of a segment then there is a coating segment that you may be familiar where people have you know waterproof coatings we are also in that segment so we are seeing again momentum in both the coatings which go on the walls as well as on the roof side and the so Dr. Fix It by far is a leader in the roofing part of it on the wall side we are making significant inroads and we have actually got a strategy to go after the driving the waterproofing solutions in a manner where we are seen as the technical expert in not only giving the best waterproofing solution but also an applicator with trained to deliver it because in this business one is knowing what needs to be done particularly when it comes to repairs and rehabilitation in the new construction also people need to trust you that you will have an applicator who will deliver the solution rather than just the products so focus on systems focus on winning big projects focus on ensuring the retail distribution ensuring that the trained waterproofer exists at various levels of let's say smaller waterproofer to medium to large waterproofer well trained and Dr. Fix It is backing them up with regards to warranties as well as let's say technical training because here what people really expect is that are our people meaning the applicators who are not exactly ours but trained by us can they deliver so we are seeing again momentum we have moved into high double digit basically mid teens plus category in this in this area as well which is something that we were not in the last year so there is momentum that we are seeing based on the new strategy that we have followed with regards to both focusing on retail and projects there are competitors in this business it's not that this you know the category does not have competitors there are multinational competitors there are local competitors and they've been around for some time so our aim is to go deeper penetrate also wider even now there is a huge opportunity particularly we see in the small builders area where enough and good waterproofing is not being done so we have an opportunity of again creating the category leading it in in the sense by educating both the the key account basically the client as well as the applicators and then ensuring that we are able to supervise the work that is being done at the sites we provide that service also site supervision on certain level of projects so it's a business which is which requires creating an ecosystem and we are building on that ecosystem as I described and that is what truly is going to be the moat in this business as we move forward again there is an opportunity because of the mega trend of construction growing there's an opportunity of better waterproofing systems as people evolve so these are the things that we are trying to do to build on this business.

Kavinder Singh: We are investing behind them, ensuring that our pool of trained applicators grows. On the other hand, we are also making significant inroads on the project side of waterproofing. We are now tapping into multiple segments, whether residential, commercial, hotels, et cetera. As you know, the construction is still doing well in our country. We have Pidilite Professional Solutions, which has a construction solution group which is focused on working with architects and structural consultants to get ourselves specified. Our systems are now getting specified, not just the products. This is helping us to build momentum in the projects business, as Sudhanshu also mentioned earlier. Even in retail, the waterproofing piece, in retail, as I said, there are product categories which are around improving the concrete performance, which is a different kind of a segment.

Kavinder Singh: There is a coating segment that you may be familiar, where people have waterproof coatings. We are also in that segment. We are seeing, again, momentum in both the coatings which go on the walls as well as on the roof side. Dr. Fixit by far is a leader in the roofing part of it. On the wall side, we are making significant inroads. We have actually got a strategy to go after the driving the waterproofing solutions in a manner where we are seen as the technical expert in not only giving the best waterproofing solution, but also an applicator who is trained to deliver it. Because in this business, one is knowing what needs to be done, particularly when it comes to repairs and rehabilitation.

Kavinder Singh: In the new construction also, people need to trust you that you will have an applicator who will deliver the solution rather than just the products. Focus on systems, focus on winning big projects, focus on ensuring their retail distribution, ensuring that the trained waterproofer exists at various levels of, let's say, smaller waterproofer to medium to large waterproofer, well-trained, and Dr. Fixit is backing them up with regards to warranties as well as, let's say, technical training. Because here, what people really expect is that are our people, meaning the applicators who are not exactly ours, but trained by us, can they deliver? We are seeing, again, momentum. We have moved into high double digit, basically mid-teens plus category in this area as well, which is something that we were not in the last year.

Kavinder Singh: There is momentum that we are seeing based on the new strategy that we have followed with regards to both focusing on retail and projects. There are competitors in this business. It's not that the category does not have competitors. There are multinational competitors, there are local competitors, and they've been around for some time. Our aim is to go deeper, penetrate also wider. Even now, there is a huge opportunity, particularly we see in the small builders area, where enough and good waterproofing is not being done. We have an opportunity of, again, creating the category, leading it in the sense by educating both the key account, basically the client, as well as the applicators, and then ensuring that we are able to supervise the work that is being done at the sites. We provide that service also, site supervision on certain level of projects.

Kavinder Singh: We have an opportunity of, again, creating the category, leading it in the sense by educating both the key account, basically the client, as well as the applicators, and then ensuring that we are able to supervise the work that is being done at the sites. We provide that service also, site supervision on certain level of projects.

Kavinder Singh: It's a business which requires creating an ecosystem, and we are building on that ecosystem as I described, and that is what truly is going to be the moat in this business as we move forward. Again, there is an opportunity because of the mega trend of construction growing. There is an opportunity of better waterproofing systems as people evolve. These are the things that we are trying to do to build on this business.

Speaker #4: Thank you for the detailed response.

Sadiq Ghouse: Thank you for the detailed response.

[Analyst] (HSBC): Thank you for the detailed response.

Speaker #1: Thank you, sir. Ladies and gentlemen, that was the last question for today. I would now like to hand the conference over to management for closing comments.

Operator 2: Thank you, sir. Ladies and gentlemen, that was the last question for today. I would now like to hand the conference over to management for closing comments.

Operator: Thank you, sir. Ladies and gentlemen, that was the last question for today. I would now like to hand the conference over to management for closing comments.

Kavinder Singh: Thank you, everybody, for joining the call, and wish each of you a good evening. Thank you very much.

Speaker #5: So, thank you everybody for joining the call and I wish each of you a good evening. Thank you very much.

Sandeep Batra: Thank you, everybody, for joining the call, and wish each of you a good evening. Thank you very much.

Speaker #1: Thank you, sir. On behalf of Equitas Securities, which funds this conference call, thank you for joining us. You may now disconnect your lines.

Operator 2: Thank you, sir. On behalf of Equirus Securities, that concludes the conference call. Thank you for joining us, and you may now disconnect your line. Thank you.

Operator: Thank you, sir. On behalf of Equirus Securities, that concludes the conference call. Thank you for joining us, and you may now disconnect your line. Thank you.

Browse all earnings call transcripts

Q1 2027 Pidilite Industries Ltd Earnings Call

Request TrialDemo

Pidilite Industries

Earnings