Asian Granito India Limited — Q3 FY26 earnings call

Call held 12 Feb 2026

Management summary

Asian Granito reported a strong Q3 FY26, with significant revenue and EBITDA growth, and a turnaround to profitability for the nine-month period. The company is focusing on product mix enhancement, retail expansion, and international markets to drive future growth, targeting Rs. 6,000 crores revenue by 2031. Despite a decline in ASP, management is optimistic about export opportunities and increased utilization of new capacities, while strategically shifting towards an asset-light model for ceramic manufacturing.

Highlights

  • Q3 FY26 Revenue grew 15.8% YoY to Rs. 423 crores.

  • Q3 FY26 EBITDA surged 210% YoY to Rs. 40.8 crores.

  • 9M FY26 PAT turned positive at Rs. 43.83 crores, compared to a loss of Rs. 4.97 crores in 9M FY25.

  • Volume increased by 15% in domestic and international tiles markets.

  • Company targets Rs. 6,000 crores revenue by 2031, focusing on product mix, retail expansion, and international markets.

Concerns

  • Average selling price (ASP) for tiles decreased from Rs. 399/sqm last year to Rs. 360/sqm currently.

  • Utilization of the new quartz big format line is low at 10%.

  • Morbi region faces restrictions on new plant development due to space constraints.

Key financials

4 periods

Headline

  • Average Selling Price (Current)
    ₹360

Q3 FY26

  • Revenue
    ₹423 Cr
    YoY +15.6%
  • EBITDA
    ₹40.8 Cr
    YoY +210.3%
  • Tiles Revenue Growth
    21%

9M FY26

  • PAT
    ₹43.83 Cr

FY26

  • Ad Spend
    ₹25 Cr

What they filed

Q1 FY27: revenue up 7.0%, net profit down 57.3% against the same quarter last year.

₹ Cr · quarterly
Line itemQ2 FY25Q3 FY25Q4 FY25Q1 FY26Q2 FY26Q3 FY26Q4 FY26Q1 FY27
Revenue323 258 340 260 272 −16%268 +4%295 −13%278 +7%
EBITDA5 -2 5 8 10 +131%8 +591%1 −86%9 +14%
Net profit2 1 10 5 8 +254%4 +294%-14 −242%2 −57%
How to read this

₹ crore, as filed. The percentage beside a figure is the change against the same quarter a year earlier — never the quarter before, which would make every seasonal business look like it collapses and booms each year.

Segment breakdown

  • Tiles
    ₹379 Cr Revenue (Q3 FY26)21% Y-o-Y Growth
  • GVT Share of Sales
    50% Share
  • Retail Share of Sales
    45% Share
  • Institutions/Govt/Sales Share of Sales
    55% Share
  • Trading Volume (Q3 FY26)
    0.6 million sqm Volume
  • Own Manufacturing Volume (Q3 FY26)
    5.19 million sqm Volume

Capital allocation

high confidence
  • Capex ₹25 Cr
    • Last plant of Continua (machine arrived, slab plant starts continuously from April)
    The total CAPEX for this year will be around Rs. 25 crores. And next year, the total CAPEX will be around Rs. 40 crores. Because everywhere, there is a share warehouse and inventory investment. So I think that by March this year, our investment will be Rs. 25 crores and by next year, it will be Rs. 40 crores.

Guidance & targets

Revenue

  • Total Revenue Revenue · by 2031 · High confidence Rs. 6,000 crores
    we hope to complete this revenue of Rs. 6,000 crores by 2031.

    — Kamlesh Patel, Chairman and Managing Director

  • Export Revenue Share Revenue · in the times ahead · Medium confidence 18% to 20%
    And from total revenue 18% to 20% revenue will be increased in exports in the times ahead.

    — Kamlesh Patel, Chairman and Managing Director

Volume

  • Quartz Growth Volume · this year · Medium confidence >20%
    And I hope that in quartz this year, we will grow more than 20% in a quarter.

    — Kamlesh Patel, Chairman and Managing Director

Distribution

  • Exclusive Showrooms Distribution · by March · High confidence >300
    By March, we will have more than 300 exclusive showrooms.

    — Kamlesh Patel, Chairman and Managing Director

  • Exclusive Showrooms Distribution · in the coming time · Medium confidence 500
    Exclusive showrooms, in the coming time, we have planned to have 500 showrooms. In the coming time, we will have presence in 500 showrooms.

    — Kamlesh Patel, Chairman and Managing Director

Capex

  • Total CAPEX Capex · this year · High confidence Rs. 25 crores
    The total CAPEX for this year will be around Rs. 25 crores.

    — Kamlesh Patel, Chairman and Managing Director

  • Total CAPEX Capex · next year · High confidence Rs. 40 crores
    And next year, the total CAPEX will be around Rs. 40 crores.

    — Kamlesh Patel, Chairman and Managing Director

  • Ceramic Greenfield CAPEX Capex · next 3-4 years · High confidence No big CAPEX
    So, in coming three, four years company does not need to do big CAPEX in ceramic.

    — Kamlesh Patel, Chairman and Managing Director

What to watch in Q4 FY26

Quartz segment growth

this year
Current Subdued due to US trade issues, domestic pressure.
Target >20% growth in a quarter.

Why it matters

Quartz is a key product; its recovery and growth are crucial for overall revenue and profitability, especially with new capacity.

And I hope that in quartz this year, we will grow more than 20% in a quarter.

Risks & concerns

  • Decline in Average Selling Price (ASP)

    medium

    ASP for tiles decreased from Rs. 399/sqm last year to Rs. 360/sqm currently.

    Analyst acknowledged

  • Low utilization of new Quartz big format line

    medium

    The third quartz line (for US market) is only at 10% utilization.

    Analyst acknowledged

  • Impact of US trade on Quartz exports

    medium

    US trade issues caused a 'break' in quartz exports, leading to domestic pressure and low prices.

    Management acknowledged

  • Morbi overcapacity and restrictions on new plant development

    low

    300 units closed in Morbi in past 5 years, and new plant development is restricted due to space.

    Analyst acknowledged

Q&A highlights

7 direct
Decline in Average Selling Price (ASP) Direct
If we look at particular tiles, last year, our nearest realization was Rs. 399 per square meter. Along with the international export and with the big format tiles that we sell at present, the company has a realization of Rs. 360 per square meter at present.

Reveals a significant 9.8% decline in ASP year-on-year, which could impact profitability despite volume growth.

Asked by Deep Doshi

Volume growth vs. ASP impact on top line Partial
Our production volume has not grown much on a year-on-year Q3, I can see that in the presentation. So, is it safe to assume that our top line is based on ASP or we got it from the existing inventory, which is our top line? ... The volume has grown, sir. The production capacity is similar. It is from export.

Analyst questions the source of revenue growth (volume vs. price/inventory), and management's response is somewhat ambiguous, suggesting volume growth but also similar production capacity and export focus.

Asked by Ashwath Ranjan

Low utilization of new Quartz big format line Direct
In the last one year, we have three quartz lines. Two lines were running completely. And its utilization was 80% to 90%. And the third line, which we made based on the US, its utilization was only 10%.

Highlights underutilization of a new asset, indicating potential for future ramp-up but also current inefficiency.

Asked by Ashwath Ranjan

Strategy for Rs. 6,000 crores revenue target by 2031 Direct
The existing revenue and the plants that have been installed in production, and the sanitary fitting plants that have been installed, and the internal planning of the company that is going on in the coming time, we hope to complete this revenue of Rs. 6,000 crores by 2031.

Provides insight into the long-term vision and the key drivers management expects to achieve this ambitious target.

Asked by Deepak Poddar

Future CAPEX strategy in ceramic industry Direct
See, we are not doing any CAPEX in the ceramic industry. ... Company will go into outsourcing model and product, design and innovation will be that of company's. ... So, in coming three, four years company does not need to do big CAPEX in ceramic.

Clarifies a strategic shift towards an asset-light model for ceramic manufacturing, focusing on outsourcing rather than greenfield CAPEX.

Asked by Ashwath Ranjan

Impact of US trade on Quartz exports and domestic market Direct
See, overall, the growth of quartz in the last one year, due to the US, the quartz that used to be exported, suddenly there was a break. So, quartz products, there was a lot of pressure in the domestic market and people used to sell at a low price in the domestic market. And due to the domestic pressure, overall growth has not been there.

Explains the challenges faced by the quartz segment and the reasons for its subdued growth, linking it to international trade dynamics.

Asked by Ashwath Ranjan

Morbi overcapacity and plant shutdowns Direct
In Morbi, it was told 1,000 units. And out of that, 450 units were of wall tiles, ceramic tiles. I believe that 300 units have been closed in the past five years. And, the GVT plants, the grazed vitrified tiles, even in that the small production plants have been closed.

Provides context on the broader industry landscape, indicating consolidation and rationalization of capacity in the Morbi cluster, which could benefit larger, more efficient players like AGL.

Asked by Ashwath Ranjan

Ad spend for FY26 Direct
Sir, when we did the first trial, it was an overall expenditure of around Rs. 40 crores. Then, last year, it was Rs. 30 crores. This year, it will be around Rs. 25 crores.

Shows a declining trend in advertising expenditure, which could be a concern if it impacts brand building or market reach, or a positive if it indicates efficiency.

Asked by Deep Doshi

3 min read 7 chapters

Detailed narrative

Q3 FY26 Performance Overview

Asian Granito reported a robust Q3 FY26, with revenue growing 15.8% year-on-year to Rs. 423 crores, up from Rs. 366 crores in Q3 FY25. EBITDA saw a significant surge of 210% to Rs. 40.8 crores, compared to Rs. 13.15 crores in the prior year. For the nine-month period, the company achieved a positive PAT of Rs. 43.83 crores, a substantial turnaround from a revenue loss of Rs. 4.97 crores in 9M FY25.

Strategic Shift and Product Mix Enhancement

The company has transitioned from a traditional, small-size manufacturing approach to investing in future ceramic and big format plants, leading to an increased overall sales realization. New product introductions like double digital product technology, architect-based designs, and robotic designs for quartz have improved per square foot realization by approximately Rs. 50. The sanitary and CPPT segments, with complete operations this year, are also contributing to the enhanced product mix.

Retail Expansion and Distribution Strategy

Asian Granito is actively strengthening its retail presence, aiming for 500 exclusive showrooms in the coming time, with over 300 expected by March 2026. The company's distribution mix has shifted, with retail now accounting for 45% of sales (up from 30%), while institutional, sales, and government projects make up 55%. This focus on quality dealers and exclusive showrooms is expected to drive future growth.

International Market Focus and Export Outlook

Exports currently constitute 15% of total revenue, with a target to increase this to 18-20% in the future. Despite past pressures from international duties, the company has established a strong retail base with warehouses and product displays in locations like Africa (Senegal), London, Dubai, and Indonesia. Management is optimistic about export growth, particularly in big formats and quartz, citing India's competitive advantage with an 18% duty compared to China's 34%.

CAPEX and Asset-Light Manufacturing Strategy

The company's CAPEX for FY26 is projected at Rs. 25 crores, primarily for the final Continua slab plant which is expected to be continuously operational from April 2026. For FY27, CAPEX is estimated at Rs. 40 crores, allocated for warehouse and inventory investments related to big format and international presence. Strategically, Asian Granito plans to adopt an outsourcing model for ceramic manufacturing in the next 3-4 years, avoiding large greenfield CAPEX in this segment and focusing on product design and innovation.

Quartz Segment Challenges and Recovery

The quartz segment faced significant pressure over the last year due to a 'break' in US exports, leading to domestic market oversupply and low prices. Consequently, overall growth in quartz was subdued. However, management is now seeing plants running again in the last 10-15 days and expects quartz to grow more than 20% in a quarter this year, indicating a potential recovery. The third quartz line, specifically for the US market, is currently at only 10% utilization, presenting a significant upside potential.

Morbi Industry Dynamics

The Morbi cluster, a major manufacturing hub, has seen consolidation, with approximately 300 units closing in the past five years, particularly small production plants for GVT and wall tiles. While the region experienced rapid development, future expansion is somewhat restricted due to space constraints. This industry rationalization could benefit larger, technologically advanced players like Asian Granito.

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