Greenpanel Industries Limited — Q3 FY26 earnings call

Call held 30 Jan 2026

Management summary

Greenpanel Industries Limited reported a robust Q3 FY26 with total revenues growing 11.4% year-on-year to INR 398.8 crore, driven by strong MDF volume growth of 17.1%. Despite a tepid retail market and discounting pressures leading to a 1.4% sequential decline in domestic realization, the company achieved higher gross margins of almost 50% and operating EBITDA margins of 11.2%. Raw material costs are stabilizing, and all production lines are EBITDA positive, though the plywood business remains a concern.

Highlights

  • Total revenues grew by 11.4% year-on-year to INR 398.8 crore.

  • Total MDF volume growth was 17.1% for Q3, driven by 19% domestic and 8.3% export volume growth.

  • Gross margins expanded to almost 50%, and operating EBITDA margins were higher both year-on-year and sequentially.

  • Raw material costs (timber and chemicals) have started reducing from January onwards and are currently stable.

  • All three production lines, including the new plant operating at 60% capacity, are making money and are EBITDA positive.

Concerns

  • Domestic realization was lower by 1.4% sequentially due to discounting pressures post-Diwali and increased proportion of OEM sales.

  • The Plywood business is yet to revive meaningfully, showing a low EBITDA margin of 1.4%.

  • Management does not foresee immediate price increases due to competitive domestic pricing, despite Rupee devaluation.

  • FX volatility on Euro-denominated borrowings resulted in a non-cash loss of INR 3 crore for the quarter and INR 43 crore cumulatively this year.

Key financials

  1. Revenue ₹398.8 Cr +11.4%YoY
  2. Domestic MDF Volume Growth — +19%YoY
  3. Export MDF Volume Growth — +8.3%YoY
  4. Total MDF Volume Growth — +17.1%YoY
  5. Domestic Realization — -1.4%QoQ
  6. Gross Margin 50%
  7. Operating EBITDA (ex-FX/one-offs) ₹44.3 Cr
  8. Operating EBITDA Margin (ex-FX/one-offs) 11.2%
  9. PBT ₹11.4 Cr
  10. PAT ₹10.2 Cr
  11. EPCG Income Q3 ₹8 Cr
  12. Power Subsidy (one-off) ₹8.5 Cr
  13. FX Impact (non-cash loss) Q3 ₹3 Cr
  14. FX Impact (non-cash loss) 9M ₹43 Cr
  15. Incremental Interest/Depreciation (new plant) ₹10 Cr
  16. Overall Capacity Utilization 63%
  17. New Plant Capacity Utilization 60%
  18. Raw Material Mix (Chemicals vs Timber) 50%

What they filed

Q1 FY27: revenue up 6.6%, net profit up 103.6% against the same quarter last year.

₹ Cr · quarterly
Line itemQ2 FY25Q3 FY25Q4 FY25Q1 FY26Q2 FY26Q3 FY26Q4 FY26Q1 FY27
Revenue337 359 375 328 396 +18%416 +16%399 +7%350 +7%
EBITDA30 17 48 -16 25 −17%41 +135%30 −38%30 +289%
Net profit19 9 29 -35 -6 −133%10 +20%1 −95%1 +104%
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

  • MDF
    11.9% EBITDA Margin
  • Plywood
    1.4% EBITDA Margin

Capital allocation

high confidence
  • Debt Net ₹163 Cr
    • Repayment Net debt reduction during 9 months (excluding non-cash FX exchange) ₹40 Cr
    • Repayment Net debt reduction from peak on June 30 ₹85 Cr
    Our net-debt is INR163 crore.

Guidance & targets

Volume

  • MDF Volume Growth Volume · Q4 FY26 · Medium confidence mid to high-teen's
    So for Q4, as we said, on an average, we should have a mid to high-teen's volume growth on an annual basis.

    — Shobhan Mittal

  • MDF Volume Growth Volume · Full FY26 · Medium confidence high team growth
    We continue to target a high team growth in MDF volumes

    — Shobhan Mittal

Profitability

  • Operating EBITDA (excluding FX and one-offs) Profitability · Full FY26 · Medium confidence high single-digit to early double-digit average
    with the operating EBITDA, excluding FX and one-offs of high single-digit to early double-digit average for the full year.

    — Shobhan Mittal

Other

  • EPCG Benefit Recognition Other · next four to six quarters · Medium confidence entire amount will come into books
    maybe in the next four to six quarters, this entire amount will come into books.

    — Himanshu Jindal

Margin

  • Sustainable MDF EBITDA Margin Margin · Low confidence up to 20%
    Well, in my opinion, with proper utilization, proper product mix, high teams is very much possible up to 20%.

    — Shobhan Mittal

What to watch in Q4 FY26

Plywood business revival plan

next few quarters
Current yet to revive meaningfully
Target management to share more details

Why it matters

Plywood is an underperforming segment (1.4% EBITDA margin), and management's strategy for its revival is crucial for overall profitability.

Plywood business is yet to revive meaningfully, and we are already working on possible next steps to scale up this business. Maybe I will be able to share more on this over the next few quarters.

Risks & concerns

  • Discounting pressures and lower domestic realization

    medium

    Domestic realization was lower by 1.4% sequentially due to post-Diwali discounting and higher OEM sales proportion.

    Management acknowledged

  • Plywood business yet to revive meaningfully

    medium

    The plywood segment continues to underperform, with a low EBITDA margin of 1.4%.

    Management acknowledged

  • Inability to pass on Rupee devaluation

    medium

    Competitive domestic pricing environment prevents passing on increased import costs from Rupee devaluation.

    Management acknowledged

  • FX volatility on Euro borrowings

    low

    INR 3 crore non-cash loss in Q3 (INR 43 crore 9M) due to Euro-denominated borrowings, considered unrealized and mark-to-market.

    Management downplayed

  • Power subsidy as a one-off component in margins

    low

    The Q3 MDF EBITDA margin includes an INR 8.5 crore power subsidy, which is a one-off in nature, implying a slightly lower underlying operational margin.

    Analyst acknowledged

Q&A highlights

8 direct
Ability to take price hikes given Rupee devaluation Direct
because of the domestic competition and pricing pressures, I do not foresee we will be able to factor in the Rupee devaluation into our pricing to the customers.

Highlights a key constraint on pricing power despite currency movements, indicating competitive market conditions.

Asked by Utkarsh Nopany

Impact of power subsidy on MDF EBITDA margin Direct
As you highlighted INR8.5 crore power subsidy which you recognize this quarter. So this MDF margin, which is coming around 12% includes that subsidy also, which is more like one off in nature. So fair assumption? Himanshu Jindal: Yes it does.

Confirms that the reported MDF EBITDA margin includes a one-off power subsidy, suggesting a slightly lower underlying operational margin.

Asked by Keshav Lahoti

Reason for 1.4% domestic realization decline and increased OEM sales Direct
While domestic pricing was unchanged from Q2 levels initially, discounting pressures from relevant peers came back into play post-Diwali, and we too had no option but to offer more discounts between November and December, much more to the OEMs where pricing is key.

Explains the pressure on realizations and the strategic shift towards OEM sales, which typically involve higher discounts, impacting blended realization.

Asked by Yash Sonthaliya

Outlook on MDF price increases Direct
as of now if you ask me, do I foresee any price increases coming in? Answer would be probably not.

Indicates management's cautious outlook on pricing power in the near term, suggesting continued competitive pressures.

Asked by Sneha Talreja

Sustainable EBITDA margin for MDF Direct
Well, in my opinion, with proper utilization, proper product mix, high teams is very much possible up to 20%.

Provides a long-term aspirational target for MDF EBITDA margin, contingent on utilization and product mix.

Asked by Anu

Capacity utilization of the new plant and overall Direct
we have done 63%-64% capacity utilizations in this quarter on a production basis... The new plant is already operating at a 60% capacity.

Confirms healthy utilization rates for both existing and new capacities, indicating efficient ramp-up and demand absorption.

Asked by Pathanjali Srinivasan

Pricing discipline vs. competition and gross margin outlook Direct
Today, we are behaving the way competition wants us or allows us to behave. So, therefore, you have seen some price reductions coming into play to ensure that we have enough volume... So for now, the conclusion is my gross margins today are at 50%.

Reveals that pricing is currently dictated by competitive dynamics to maintain volumes, but gross margins are holding at 50%.

Asked by Pathanjali Srinivasan

EPCG benefit and subsidy part Direct
So there is 32 EPCG, which is shown as liabilities in my book, which the moment I export more and more, I will keep recognizing... maybe in the next four to six quarters, this entire amount will come into books.

Clarifies the remaining EPCG benefit to be recognized and its potential impact on future other operating income.

Asked by Utkarsh Nopany

3 min read 7 chapters

Detailed narrative

Q3 FY26 Performance Overview

Greenpanel Industries Limited reported a total revenue of INR 398.8 crore for Q3 FY26, marking an 11.4% year-on-year growth. This was primarily driven by a 17.1% increase in total MDF volumes, with domestic volumes growing 19% and export volumes 8.3% year-on-year. Despite a challenging retail environment and increased discounting, the company achieved a gross margin of nearly 50% and an operating EBITDA of INR 44.3 crore, translating to an 11.2% margin, excluding FX and one-off impacts.

MDF Segment Dynamics and Realization Pressures

The MDF segment experienced strong volume growth, but domestic realization declined by 1.4% sequentially. This was attributed to discounting pressures from competitors post-Diwali and a higher proportion of sales to OEMs, where pricing is more competitive. OEM sales now constitute roughly 25% of domestic MDF sales, up from 23% last year. Management indicated that pricing is currently dictated by competitive dynamics to maintain volumes, and no immediate price increases are foreseen despite Rupee devaluation.

Raw Material and Cost Management

The company observed volatility in timber costs due to winter conditions but noted a reduction trend from January onwards. Chemical costs, which peaked in Q2, have also been declining, supporting margins. Despite higher fuel and power costs partially negating raw material savings, the cost of production remained almost flat sequentially. The raw material mix between chemicals and timber is currently balanced at roughly 50-50.

Subsidies and One-off Items

Greenpanel recognized an INR 8.5 crore power subsidy in Q3, which was added to other operating income and contributed to the MDF EBITDA margin. Additionally, INR 54 crore of capital subsidy, part of a total INR 96 crore from the Andhra Pradesh government, was adjusted against the carrying cost of assets, which will lead to lower depreciation expenses in the future. The company also recognized INR 8 crore in EPCG benefits in Q3, with INR 32 crore remaining to be recognized over the next 4-6 quarters.

Capacity Utilization and Operational Efficiency

Overall capacity utilization for the quarter stood at 63-64% on a production basis, with the new plant operating at a healthy 60% capacity. Management confirmed that all three production lines, including the new facility, are now making money and are EBITDA positive. The company emphasized its production flexibility, allowing it to optimize output across lines based on economics and demand, rather than being constrained by individual plant capacities.

Plywood Business and Future Outlook

The plywood business continues to struggle, with an EBITDA margin of only 1.4% for the quarter, and has not yet revived meaningfully. Management is actively working on strategies to scale up this segment and expects to share more details in the coming quarters. For the full FY26, the company maintains its guidance for mid-to-high teen MDF volume growth and high single-digit to early double-digit operating EBITDA (excluding FX and one-offs).

Financial Position and FX Impact

The company's net debt stood at INR 163 crore, with a reduction of INR 40 crore over the past nine months (excluding non-cash FX impact) and INR 85 crore from its June 30 peak. However, FX volatility on Euro-denominated borrowings resulted in a non-cash, mark-to-market loss of INR 3 crore for the quarter, bringing the cumulative impact to INR 43 crore for the nine months. The core cash conversion cycle remained stable at 32 days.

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