Creative Graphic — Q4 FY26 earnings call

Call held 25 May 2026

Management summary

Creative Graphic reported strong revenue growth for FY26, reaching Rs. 348 crores, driven by capacity expansion and new product launches. However, profitability saw a decline in H2 FY26 due to significant raw material price volatility and supply chain disruptions. The company is actively managing working capital through new credit lines and focusing on exports, while continuing to pursue its ambitious growth targets despite ongoing market challenges.

Highlights

  • Consolidated revenue for FY26 was Rs. 348 crores, a significant increase from Rs. 135 crores in FY24.

  • H2 FY26 consolidated revenue increased to Rs. 172 crores from Rs. 140 crores in H2 FY25.

  • Successfully passed on raw material price increases to clients, with prices increasing from Rs. 400 to Rs. 550 in some instances.

  • Secured a Rs. 60 crore credit limit from Citibank and initiated bill discounting facilities to support working capital needs.

  • Actively pursuing export markets, with orders for over 100 metric tons already in hand.

Concerns

  • Net profit after tax for FY26 declined to Rs. 18.67 crores from Rs. 20.77 crores in FY25, a 10.01% decrease.

  • H2 FY26 consolidated PAT dropped significantly to Rs. 6.55 crores from Rs. 12.21 crores in H1 FY26, a 46.35% decline.

  • Gross margins were impacted by approximately Rs. 5 crores due to raw material price volatility (aluminum, PVC, Nylon derivatives) and supply chain issues.

  • Project commercialization for new facilities (20,000 MT Alu Alu factory, Bosch machine, Oman facility) experienced delays.

Key financials

2 periods

Headline

  • Consolidated Revenue
    ₹348 Cr
    YoY +157.8%
  • Consolidated PAT
    ₹18.67 Cr
    YoY -10%

H2

  • FY26 Consolidated Revenue
    ₹172 Cr
    YoY +22.9%
  • FY26 Consolidated PAT
    ₹6.55 Cr
    QoQ -46.4%

What they filed

Q4 FY26: revenue up 102.4%, net profit up 75.0% against the same quarter last year.

₹ Cr · quarterly
Line itemQ4 FY23Q2 FY24Q4 FY24Q2 FY25Q4 FY25Q2 FY26Q4 FY26
Revenue48 48 84 113 138 +188%176 +267%170 +102%
EBITDA8 12 7 13 19 +138%21 +75%12 +71%
Net profit5 7 4 9 12 +140%12 +71%7 +75%
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

Share of Revenue
₹348 Cr Total
  • Alu Alu Business ₹218 Cr 62.6%
  • Flexo Business ₹130 Cr 37.4%

Order book

medium confidence

Composition

  • Export Orders (All products) (product) 100 metric tons

Pipeline

other

Export partners in hand

Management indicated a full order book and an overload of orders, but did not quantify the total value. Export orders of over 100 metric tons were specifically mentioned.

Source: Q&A

Capital allocation

high confidence
  • Capex ₹30 Cr
    • PVDC and Tandem machines, utilities and pre-operative expenses ₹15 Cr
    • Capacity enhancement and capability building (general)
    I think if you see the consolidated cash flow statement, consolidated sheet, you will see around 30 crores of Capex. ... PVDC was only a 2.5 crore machine. Tandem was so total it would be around 10 crores for machines, but we have also spent significantly on utilities and pre-operative expenses. So, around 15, 16, 17 crores.
  • Liquidity Undrawn ₹60 Cr Secured a new credit limit from Citibank for the group to support working capital. Initiated bill discounting facilities, with a transaction of Rs. 3-4 crores in March.
    We signed at the far end of March, we signed on Citibank, who has given us a limit of around 60 crores to the group. And we have also again in March, started bill discounting, which was something that we mentioned was a focus area in our last interaction. So happy to report that we have done our first on-ground transaction also of around 3-4 crores in March and those facilities are scalable.

Guidance & targets

Revenue

  • Top line growth Revenue · going forward · Medium confidence double every year
    So, so you think we can double top line every year going forward? ... We are, we are, that is that is our expedition and we think the kind of facility we would definitely try to.

    — Deepanshu Goel

  • Top line target Revenue · by FY28 · High confidence ₹1000 crores
    Yes, sir, we said that we would be, you know, doubling our revenue every year going forward. So that implies that the 1000 crores of top line target that we have, that would be achievable by FY28. Is my understanding correct?

    — HK

  • Bangalore unit revenue Revenue · per annum · Medium confidence ₹10 to 12 crore rupees
    Yeah, so maybe estimate of close to 10 to 12 crore rupees to of our revenue per annum.

    — Deepanshu Goel

Business Mix

  • Business split for ₹1000 crore target Business Mix · at 1000 crore top line · High confidence 80% Wahren, 20% Flexography
    80% from the Wahren business, which will itself have Alu Alu, it will have PVDC, it will have tandem products and 20% from flexography.

    — Pulkit Agrawal

Margin

  • Wahren Business Margin Profile Margin · at 1000 crore top line · High confidence 17-18% Gross margin, mid-teens 14% EBITDA
    The margin profile at that state would be around 17-18% Gross margin and mid-teams 14% kind of EBIDTA Market.

    — Pulkit Agrawal

Capacity Utilization

  • Alu Alu utilization Capacity Utilization · FY27 · Medium confidence 40 to 50%
    So, I think going to the because April may have been impacted. So, let's see, could we should be 40 to 50%? We'll have to see how does the market behave.

    — Deepanshu Goel

  • PVC PVDC plant utilization Capacity Utilization · FY27 · High confidence 25%
    Close to twenty-five percent.

    — Deepanshu Goel

Export

  • Alu Alu export share Export · FY27 · High confidence 20%
    Still, not less than that. Twenty percent is in the top.

    — Deepanshu Goel

What to watch in Q1 FY27

Supply Chain Normalization

within a month
Current Not out of the woods yet, but getting some visibility
Target Normalized supply chain

Why it matters

Normalization of supply chain directly impacts raw material availability, pricing, and ability to fulfill orders, thus affecting margins and revenue.

So I'll be honest with you, the supply chain issues are not, we are not still out of the woods yet. The, it is open news, I don't, I think I am an expert on it. Everybody is, you know, in the same boat. So, we are not still out of the woods yet, but I think now we have started to get some visibility on things normalizing.

Risks & concerns

  • Raw Material Price Volatility

    high

    Volatile prices for aluminum (50% of pharma packaging raw material), PVC, and Nylon derivatives significantly impacted H2 gross margins.

    Management acknowledged

  • Supply Chain Disruptions

    high

    War-related issues, shipping delays, and port clogging led to restricted supply, impacting production and increasing procurement costs in H2.

    Management acknowledged

  • Project Commercialization Delays

    medium

    New facilities like the 20,000 MT Alu Alu factory, Bosch machine, and Oman facility experienced delays in commercialization, impacting revenue accruals.

    Management acknowledged

  • Working Capital Intensity

    medium

    Increased working capital requirements due to higher raw material prices and longer project cycles, addressed by new credit lines and bill discounting.

    Management acknowledged

Q&A highlights

7 direct
Competitive advantage in Alu Alu business Direct
we are not dependent on only one product. Svam has a not mitigated this, not has expanded its strength. Now, we go to any client where we have all the product when it comes to OSD, we are dealing with CR foil, we are dealing with the Blister foil, we are dealing with the with all PVC, PVDC products.

Management explained their diversified product portfolio and better market capitalization as key competitive advantages against larger, single-product incumbents.

Asked by Arnav Nawalkha

Client concentration Direct
So, our distribution is very, very equitable. It is not concerted to one or two clients who are have been buying 80% of the, so 80% of the revenue it has not been there. It has been very very well distributed and because in pharmaceutical, especially for the primary packaging which we have been manufacturing, the initial resistance is high that they start buying up with a very smaller quantity. ... We are more than, we are having more than 400 clients and slowly, steadily they have started buying more.

Management clarified that their client base is highly diversified with over 400 clients, mitigating concerns about concentration risk.

Asked by Arnav Nawalkha

Feasibility of doubling top line every year Direct
I don't think we need to revise; there have been some correction here and there, but as far as the Indian market is concerned, as far as the outside demand is concerned, there has been no impact as such, as if now. ... We are, we are, that is that is our expedition and we think the kind of facility we would definitely try to.

Analyst questioned the aggressive growth target given macro environment, but management reiterated their commitment to doubling top line annually, citing no impact on demand.

Asked by Arnav Nawalkha

Reasons for H2 margin decline and supply chain issues Direct
So the first reason is the margin was anyway going to be impacted because we are on an expansion phase and our expenses are and our expenses are front loaded. So, our expenses are upfront, whereas the benefit will come in future periods. On top of it, we also had a very volatile period, in the pharma business because of the tariff situation and the supply chain issues, war related issues, that has added as a layer on top of it.

Management attributed margin decline to front-loaded expansion costs and raw material price volatility exacerbated by geopolitical issues, confirming the challenges faced.

Asked by Deepak Poddar

Ability to pass on price increases to clients Direct
Yes, absolutely. The prices have gone up. So, it's a partnership that we have with our clients. It is a sticky business. Our clients are people who want best quality, they want best hygiene, they want best qualifications. ... A few months ago, we were selling at 400 rupees. Now we are selling deepanshu ji at 550.

Management confirmed their pricing power and ability to pass on raw material cost increases due to strong client relationships and focus on quality.

Asked by Deepak Poddar

Competitor reaction to market share gains Direct
I won't say it is still significant. We are closely under 10% of the market share. Definitely when a strong contender enters into the market, the competition would try to switch that kind of a issue with cutting the pricing or with a lot many other things. ... Wahren has been establish where if you know some pharmaceutical company, they would say that we are, if it comes to pharmaceutical packaging, Wahren has been the fastest ever-growing company when it comes to capacity building and capability building.

Analyst questioned how competitors reacted to Creative Graphic's market entry; management acknowledged competitive pressure but asserted Wahren's established position and growth.

Asked by Manjeet Buaria

Hedging aluminum prices Partial
Hedging. We've recently enabled ourselves to start hedging for aluminium, but we have not started doing that yet. As Deepanshu ji mentioned, we have acquired a significant quantity of aluminium recently, so that is acting as a hedge right now. We don't want to go overboard by hedging on top of it, but we will start doing it once we see. First, the rates come down and 2nd, some stability on the aluminium availability.

Analyst inquired about hedging strategies for volatile aluminum prices; management indicated they are exploring it but proceeding cautiously, using current stock as a temporary hedge.

Asked by Raunak

Competitiveness of PVDC and Tandem segments Direct
They are less competitive. There are very few players in the PVC, PVDC, and the tandem of facility, and there is a latent demand, unmet demand in the market. which is why I think they are less competitive.

Management highlighted that PVDC and Tandem segments are less competitive than Alu Alu due to fewer players and unmet demand, indicating higher growth potential.

Asked by Manjeet Buaria

2 min read 7 chapters

Detailed narrative

Financial Performance Overview

Creative Graphic reported a consolidated income of Rs. 348 crores for FY26, marking a substantial increase from Rs. 135 crores in FY24. However, the net profit after tax for FY26 decreased to Rs. 18.67 crores from Rs. 20.77 crores in FY25. The second half of FY26 saw consolidated revenues of Rs. 172 crores, up from Rs. 140 crores in H2 FY25, but PAT for H2 FY26 declined to Rs. 6.55 crores from Rs. 12.21 crores in H1 FY26.

Margin Compression and Supply Chain Challenges

The company experienced margin compression in H2 FY26 primarily due to front-loaded expenses associated with capacity expansion and significant raw material price volatility. Aluminum prices, which constitute 50% of raw material for pharma packaging, along with PVC and Nylon derivatives, were highly volatile. Geopolitical issues led to supply chain disruptions, shipping delays, and port congestion, resulting in higher procurement costs and an estimated Rs. 5 crore impact on gross margins.

New Product Launches and Capacity Expansion

Creative Graphic launched several new initiatives, including a Flexo factory in Bangalore and another in Oman, a PVC/PVDC product line, and a 20,000 metric ton Alu Alu factory, which is nearing commercialization. The installation of a Bosch machine is also complete, with trials underway and commercial revenues expected soon. Total capital expenditure for FY26 was approximately Rs. 30 crores, with Rs. 15-17 crores specifically allocated to PVDC/Tandem machines and related infrastructure.

Market Strategy and Competitive Positioning

The company aims for an ambitious target of doubling its top line annually, targeting Rs. 1000 crores by FY28. This growth is projected to be driven by the Wahren business (80% from Alu Alu, PVDC, and tandem products) and Flexography (20%), with Wahren business expected to achieve 17-18% gross margin and mid-teens 14% EBITDA at the Rs. 1000 crore level. Management emphasized its diversified product portfolio in pharma packaging as a key competitive advantage.

Working Capital and Liquidity Management

To address increased working capital requirements stemming from higher raw material prices, the company secured a Rs. 60 crore credit limit from Citibank. Additionally, Creative Graphic initiated bill discounting facilities, with a transaction of Rs. 3-4 crores in March. These measures are intended to provide a robust working capital platform to support the company's growth trajectory.

Export Focus and Market Share

Creative Graphic is actively expanding its presence in export markets, having received its first export order in February and currently holding orders for over 100 metric tons. The company anticipates better realization and margins from exports, with a target for Alu Alu exports to constitute 20% of its business in FY27. The current market share for Alu Alu is approximately 10%.

Pricing Power and Client Relationships

Despite the volatile raw material environment, the company has demonstrated pricing power, successfully passing on cost increases to its clients. Management cited an example where prices increased from Rs. 400 to Rs. 550. This ability is attributed to strong, long-standing client relationships built on providing high-quality products and services, making it a 'sticky business'.

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