GMM Pfaudler Q1 FY27 earnings call

GMM Pfaudler has undergone a significant organizational transformation, moving from a traditional geographical structure to four distinct global divisions: CRT, PPT, HET, and PST. This change aims to integrate global expertise, accelerate product innovation, improve customer responsiveness, and strengthen cross-selling opportunities. The new model, led by Group CEO Gregory Gelhaus, is expected to foster a global mindset, enhance accountability, and drive sustainable, profitable growth by focusing on technology development, product strategy, and operational excellence across each division.

For Q1 FY27, GMM Pfaudler reported consolidated revenue of ₹925 crores, marking a 16% year-on-year growth. The consolidated order backlog stood at a record ₹2,289 crores, increasing 20% YoY and 4% QoQ, providing strong revenue visibility. However, EBITDA for the quarter was ₹94 crores, a 7% decline YoY, primarily due to continued pricing pressure and investments in the new global organizational structure, though it improved 25% QoQ. Profit after tax more than doubled YoY to ₹22 crores.

The CRT division reported revenues of ₹466 crores (+10% YoY) and order intake of ₹502 crores (+23% YoY), maintaining its leadership. PPT saw strong growth with revenues of ₹255 crores (+23% YoY) and order intake of ₹367 crores (+64% YoY), benefiting from expanding customer adoption. HET's revenue was flat at ₹74 crores, but order intake surged over 700% to ₹58 crores, driven by growth opportunities in energy, petrochemical, and industrial applications. PST recorded revenues of ₹131 crores (+46% YoY) and order intake of ₹80 crores.

The company is prioritizing strengthening its balance sheet and improving cash generation. It plans to repay approximately EUR 7 million of debt by the end of Q2 FY27. The total debt as of March '26 was around ₹835 crores, with management aiming for a gradual but meaningful improvement in leverage metrics over the coming quarters. The average cost of debt is between 6% to 7%, with international debt denominated in USD/Euro and hedged. The company expects to reduce debt over the next 12-18 months and stabilize its tax rate around 30% within 18-24 months through refinancing and organizational restructuring.

Management noted a significant improvement in the Indian pharma sector, particularly in Hyderabad, driving investments and glass-lined business backlog. International pharma markets in Europe and Americas also show improving trends. However, the chemical sector remains challenging globally. The current order book is largely composed of projects with 10-12 month execution cycles, providing strong revenue visibility for FY27. The company expects margin recovery and improvement over the next few quarters, driven by ongoing initiatives to reduce costs and enhance operational efficiency.