CARYSIL LIMITED — Q3 FY26 earnings call

Call held 5 Feb 2026

Management summary

Carysil reported a strong Q3 FY26 with consolidated total income growing 8.6% YoY to Rs. 225.2 crores and PAT surging 69.7% YoY to Rs. 21.3 crores, driven by significant EBITDA margin expansion to 19.4%. Volume growth was robust across key product categories. The company anticipates substantial export growth opportunities following new Free Trade Agreements and a reduced US tariff, which will allow for rolling back discounts and further margin improvement, despite a soft UK market.

Highlights

  • Consolidated Total Income for Q3 FY26 grew 8.6% YoY to Rs. 225.2 crores.

  • EBITDA for Q3 FY26 increased 31.9% YoY to Rs. 43.7 crores, with margin expanding to 19.4%.

  • PAT for Q3 FY26 surged 69.7% YoY to Rs. 21.3 crores.

  • Volume growth was robust across Quartz Granite Sinks (27% YoY) and Stainless Steel Sinks (23% YoY) in Q3 FY26.

  • Gross margin improved from 35% to over 50% due to 'cut less, make more' strategy and lower raw material prices.

  • New Free Trade Agreements with UK, Australia, UAE, Oman, EU, and a reduced US tariff (from 50% to 18%) are expected to significantly boost exports and profitability.

Concerns

  • The UK market remains relatively soft due to ongoing economic challenges.

  • Q3 FY26 growth rate was impacted by the surfaces business being flat, despite overall positive performance.

  • High tariff rates in the US market during Q3 FY26 necessitated additional discounts of 15-20%, impacting revenue growth, though this issue is now resolved with the new trade deal.

Key financials

3 periods

Headline

  • Gross Debt (Dec 31, 2025)
    ₹228 Cr
  • Cash & Bank Balance (Dec 31, 2025)
    ₹11.4 Cr

Q3 FY26

  • Total Income
    ₹225.2 Cr
    YoY +8.6%
  • EBITDA
    ₹43.7 Cr
    YoY +31.9%
  • EBITDA Margin
    19.4%
  • PAT
    ₹21.3 Cr
    YoY +69.7%

9M FY26

  • Total Income
    ₹698.7 Cr
    YoY +12.9%
  • EBITDA
    ₹139.5 Cr
    YoY +26.9%
  • EBITDA Margin
    20%
  • PAT
    ₹71.6 Cr
    YoY +57.3%
  • Total CAPEX
    ₹44.6 Cr

What they filed

Q1 FY27: revenue up 15.4%, net profit up 39.1% against the same quarter last year.

₹ Cr · quarterly
Line itemQ2 FY25Q3 FY25Q4 FY25Q1 FY26Q2 FY26Q3 FY26Q4 FY26Q1 FY27
Revenue207 203 204 227 241 +16%223 +10%234 +15%262 +15%
EBITDA37 29 35 44 46 +24%42 +45%45 +29%53 +20%
Net profit17 13 19 23 27 +59%21 +62%27 +42%32 +39%
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.

Capital allocation

high confidence
  • Capex Capex disclosed
    • Plant and machinery, buildings, moulds and other equipments ₹44.6 Cr
    Total CAPEX for 9 months period FY26 stood at Rs. 44.6 crores which includes plant and machinery, buildings, moulds and other equipments.
  • Debt Gross ₹228 Cr
    • Repayment Reduced debt from Rs. 253 crores (March) to Rs. 228 crores (December 31, 2025) ₹25 Cr
    Gross debt stood at Rs. 228 crores as on 31st December 2025.
  • Liquidity Cash ₹11.4 Cr
    Cash and bank balance stood at Rs. 11.4 crores.

Guidance & targets

Revenue

  • US Services Revenue Growth Revenue · current year (FY26) · Medium confidence 15%
    I think on likelihood end of this year, the US services will grow by 15% in the current year, UK business will be still soft for the current year.

    — Chirag Parekh

  • Overall Revenue Growth Revenue · next 3 years (implied) · Medium confidence 15% to 20%
    Growth and speed is if anybody knows our Company and we know that we don't leave any stone unturned. Right. So, I think that is what the least I think anybody would expect from us to go out of 15% to 20%.

    — Chirag Parekh

  • Carysil 2.0 Additional Revenue Revenue · Not specified · Low confidence $100 million
    Carysil 2.0, we are looking at adding another $100 million. So, you will see a great lot of excitement if you are going to be there on 4th of April.

    — Chirag Parekh

  • Indian Market Revenue Revenue · next 5 years · High confidence Rs. 500 crores
    Online business, we see a massive potential of the online business and part of our endeavor to have a story of 500 crores of India in the next 5 years.

    — Chirag Parekh

Capacity

  • Utilization of expanded Quartz & SS Sink capacity Capacity · Immediate · High confidence immediate utilization
    See, all likelihood now with the US tariff sorting out with what the growth we have with IKEAS and all I think we are looking at a very immediate utilization of the capacity.

    — Chirag Parekh

Margin

  • Gross Margin Margin · Ongoing · High confidence 50%+
    Our gross margin approximately has improved from 35% to 50% plus.

    — Chirag Parekh

Market Share

  • US and IKEA business share of total Market Share · Not specified · High confidence >60%
    Roughly, if you ask the US, IKEA and all put together would be about more than 60% of the business.

    — Chirag Parekh

What to watch in Q4 FY26

Quartz Granite Sink additional capacity operationalization

Q1 FY27 (April 2026)
Current Delayed
Target Operational

Why it matters

Will boost production capacity to meet strong demand and contribute to revenue growth.

We expect an additional capacity, which we had announced earlier, to become operational by Quarter 1,in April, 2026. This has been a bit delayed since we were waiting for the US deal news.

Risks & concerns

  • Soft UK Market

    medium

    The UK market remains relatively soft due to ongoing economic challenges, making the environment very challenging.

    Management acknowledged

  • Global Headwinds & Tariff Challenges (US)

    low

    Prevailing global headwinds and tariff-related challenges in the US market impacted Q3, but the issue is now largely resolved with the new trade agreement reducing tariffs from 50% to 18%.

    Management acknowledged

Q&A highlights

6 direct
US Market Pricing Strategy & Discount Rollback Direct
Like I said, the rollback is happening on a pro rata basis with immediate effect. I mean 50% tariff is still about 18%. So, post pro rata to that the rollback is already, we have already informed all our customers, it will be with immediate effect.

Clarifies the immediate positive impact of the new US trade deal on pricing and margins, indicating improved profitability.

Asked by Sagar Jethwani

Effective Discounting in Q3 FY26 for US Business Direct
I can just tell you range approximately it was I think between 15% to 20%.

Quantifies the margin pressure faced in Q3 due to tariffs, providing context for the reported revenue growth vs. volume growth.

Asked by Sagar Jethwani

IKEA Sales Performance (non-US market) Partial
Overall, across Europe, we see a good increase. I would say some of the area there's a sharp increase. IKEA per se is doing exceptionally well. We had some, probably the highest sales last month IKEA. So, it's doing pretty well. They like our things. We invested in new malls. We have been investing as we announced last time, we have about close to 70%-80% of the IKEA's global business.

Highlights strong performance with a key global client and confirms continued investment, despite confidentiality preventing specific numbers.

Asked by Sagar Jethwani

Entry into Hard Surfaces Business in UK Direct
The fabrication business first prototype is coming up by April when we are doing the expo, the 2.0 summit. We are going to display this new fabrication business in that expo. So, it is going to come as fast as in Quarter 1.

Provides a timeline for a new business segment, indicating diversification and future growth avenues.

Asked by Avijit Sheel

Borrowing Plans for FY27 and FY28 Partial
We don't want to borrow. We are having a budget meeting in March. So, we can provide you with some information after we do our board meeting on budget for the next financial year.

Indicates a cautious approach to debt and defers specific borrowing plans to a future board meeting, suggesting financial prudence.

Asked by Avijit Sheel

Gross Margin Expansion Drivers Direct
So, Vaidik, this margin expansion came mainly from the raw material price, imported raw material price. MMA prices have gone down from $2.02 in April to $1.5 in December. So, there is a good value we got in the raw material pricing. And therefore, this margin expansion happened on the gross margin side. That's the main reason.

Clearly attributes the significant margin improvement to favorable raw material prices, providing insight into profitability drivers.

Asked by Vaidik Bafna

Growth Rate of Surfaces Business Direct
But one big thing change we are doing is we mantra is 'cut less, make more'. So, we are now cutting exotic stones, very-very high-end stones. Our gross margin approximately has improved from 35% to 50% plus.

Explains the strategic shift in the surfaces business towards higher-margin products and improved gross margins, indicating a focus on profitability over pure volume.

Asked by Pritesh

UK Business Growth Initiatives Direct
Right. See, the diversification and product expansion is the fastest way by adding new customers. We have a great English team. We recruited some new, senior and experienced people to put the appliances and the faucets on a fast road track in the UK. We recruited business development managers to further expand in the companies which people have left or some companies have got closed. We got experienced people from there to maximize our market share. Third, we have did, I announced that Carysil is putting its first huge showroom. It is in Manchester, right on the Design District.

Details concrete steps being taken to revive growth in the challenging UK market, including team expansion, product diversification, and brand presence.

Asked by Resha Mehta

3 min read 7 chapters

Detailed narrative

Q3 FY26 Financial Performance Overview

Carysil Limited reported a strong Q3 FY26, with consolidated total income reaching Rs. 225.2 crores, an 8.6% increase from Rs. 207.4 crores in Q3 FY25. EBITDA grew significantly by 31.9% to Rs. 43.7 crores, leading to an EBITDA margin of 19.4%. Profit after tax saw a substantial rise of 69.7% to Rs. 21.3 crores, compared to Rs. 12.5 crores in the prior year, reflecting improved operational efficiency and strategic shifts.

Volume Growth Across Key Product Categories

The company demonstrated robust volume growth in its core product segments during Q3 FY26. Sales volumes for Quartz Granite Sinks increased by 27% compared to Q3 FY25, driven by strong demand. Similarly, Stainless Steel Sink sales volumes grew by 23% in the same period. Kitchen appliances and other products contributed 15,620 units to the sales volume, indicating broad-based demand.

Impact of Trade Agreements and US Tariff Reduction

Recent Free Trade Agreements with the UK, Australia, UAE, Oman, and the EU, coupled with a new US trade deal reducing tariffs from 50% to 18%, are expected to provide strong momentum for exports. In Q3 FY26, the company extended 15-20% additional discounts to key US customers to mitigate the 50% tariff impact. This discount will now be rolled back immediately, positively impacting future margins and competitiveness in the US market.

Capacity Expansion & Product Portfolio

Carysil is actively expanding its manufacturing capabilities to meet growing demand. An additional Quartz Granite Sink capacity is expected to be operational by Q1 FY27 (April 2026). Stainless Steel Sink capacity is being increased from 180,000 to 250,000 units by April 2026. The company is also scaling its built-in appliances capacity to 100,000 units per annum and expanding kitchen faucet capacity to 100,000 pieces per annum, focusing on advanced filtration technology and PVD for enhanced durability.

Strategic Focus on High-Margin Products and Market Expansion

The company's strategy, termed 'cut less, make more,' has led to a significant improvement in gross margins from approximately 35% to over 50%, driven by a focus on exotic, high-end stones in the surfaces business. Carysil is also strengthening its brand presence and expanding into new and emerging markets, particularly the Middle East and Gulf regions, with new experience centers opening in Muscat and Sharjah, and plans for another in March 2026.

Carysil 2.0 Vision & Strategic Roadmap

Carysil plans to host its first international Carysil Summit 2.0 on April 4, 2026, in Mumbai to showcase its vision for becoming India's largest integrated kitchen hub. This event will detail the company's strategy to achieve a target of Rs. 500 crores in the Indian market over the next five years and add another $100 million in revenue, outlining a comprehensive growth roadmap for investors and stakeholders.

Debt Management and Capital Prudence

The company has demonstrated prudent financial management by reducing its gross debt from Rs. 253 crores in March to Rs. 228 crores as of December 31, 2025. With a cash and bank balance of Rs. 11.4 crores, management expressed a preference against additional borrowing for CAPEX, indicating a focus on internal accruals for funding future growth. Specific borrowing plans for FY27 will be discussed after the March board meeting.

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