Building Material Q1 Results Preview- Pipe Companies To Report Healthy Volume, Profitability: ICICI Securities

ICICI Securities Report

We expect building material companies under our coverage to report mixed performance in Q1 FY25. Pipe and MDF companies may report healthy volume growth, while tiles, sanitaryware and plywood segments may continue to report muted demand.

Pipe companies could report volume growth of 15–25% YoY with better demand from agriculture in Q1 FY25E (Q1 is seasonally strong); plumbing demand remains healthy.

Ebit/kg for pipe companies could strengthen YoY by 11.8-103% (except Finolex Industries which may be impacted by inferior product mix) with some inventory gains and benefit of operating leverage. In tiles, Kajaria Ceramics /Somany Ceramics may see modest volume growth of 7%/6% YoY with operating profit margin declining 70bps for Kajaria Ceramics (on high base) and +29bps for Somany Ceramics.

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