Transcript of the Earnings call for Quarter and Financial Year ended 31st March, 2026 pursuant to Regulation 30 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015
SOMANYCERA · price
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Somany Ceramics reported 6% sales growth in Q4 and 5% for FY26 with EBITDA margins improving to 11.4% in Q4 and 9.3% for the full year. The company achieved breakeven at its Max plant (from INR9 crore loss last year). Sanitaryware grew 8% to INR320 crore. Working capital improved significantly with debtor days reduced from 51 to 40. Net dealer addition of 200 took total showrooms to 3,100. The Russia-Ukraine war caused gas prices to surge from March 9th, with Morbi currently at INR74 plus 6% per SCM, while North plant is INR3-4 cheaper. The industry took tile price hikes of 16-17% and sanitaryware of 8% to offset costs. Morbi is operating at 60-65% capacity due to labor shortage but expected to reach 85% by month-end. Management guided EBITDA margin improvement of at least 150 bps and expects 20-25% revenue growth if gas prices stay elevated. A share buyback is blocked for 6-8 months due to SEBI embargo on JV consolidation activities.
The geopolitical gas crisis has enabled pricing discipline benefitting organized players like Somany. With 150 bps margin guidance and capacity utilization improvements, the stock could re-rate as Morbi faces ongoing challenges. The promoter has already stepped in to buy shares before the trading window shut.