Prince Pipes And Fittings Limited — Q3 FY26 earnings call

Yes. So of course, January has been primarily driven by restocking demand. I would not say channel inventory is very high right now because to begin with, channel inventory was very low in December. So I think channel inventory is still getting normalized as we speak. So yes, that is where it is. And anyway, for the end product, this tends to be a strong quarter in terms of plumbing and agri. So that fueled by a strong restocking, I think, will lead to some sustainable uptick in demand going forward.

Clarifies the nature of the strong January growth, indicating a mix of restocking and underlying demand, which is crucial for understanding sustainability.

Asked by Keshav Lahoti

Yes. We have -- in CPVC, we have moved on to our own in-house compounding. And we have launched our brand SmartFit Plus in the December quarter. Of course, our costs go down as a result of this. And we have passed that on to the channel. And that is reflected in the kind of volume growth that we have had in the December quarter, mainly has been led by the plumbing segment. And specifically in that, CPVC has been our highest growing segment in the December quarter. So I think most of the cost benefit we have passed on to the channel, and we are growing and increasing our market share in the CPVC space.

Reveals the successful transition to in-house CPVC compounding, the cost benefits (6-7%) passed on, and its positive impact on Q3 CPVC volume growth and market share.

Asked by Keshav Lahoti

Yes. I think for us, working capital and cash flow has been sort of a KPI for the senior management team. I think major free cash unlock has happened from reduction in inventory, which is primarily driven by we have tried to increase our sourcing from domestic sources where lead times are lower, and we have to get we have to we can work on just-in-time inventory. And as far as so I think going forward, inventory should remain in this kind of a range of 70-odd days. And receivables, we have seen reduce to 49 days.

Details the operational strategies (domestic sourcing, just-in-time inventory, channel finance) that led to significant working capital improvement and sets future targets for receivables and inventory days.

Asked by Meet Jain

I think, Sneha, one is, of course, the reason of China and the government -- Chinese government announcing that they will stop subsidizing the exports out of China. And secondly, we are also seeing lower arrival of imports in general. What I am seeing at a macro picture is that industry is consolidating, both manufacturers as well as traders of PVC, both are consolidating. And I feel smaller players, even some medium-sized players are also really struggling in this kind of an environment. So while operational performance, we are far from where we want to be in terms of the desired state, but still being a debt-free company and still managing even a low single-digit kind of volume growth in these times. We believe that this consolidation will continue to happen going forward, both for processors and for the traders of PVC. So I think that's as far as the lower arrivals of PVC are concerned. But going forward, I think more stability, less volatility. I think everyone knew that in the 60s, it was not going to be sustainable. Eventually, production cuts would start across the globe for PVC raw materials. So now that we have crossed this kind of INR70 per kg, I think it should now be range bound. That is what we are hoping for going forward.

Provides a comprehensive explanation for the recent PVC price hike, including global factors and domestic consolidation, and offers a forward-looking view of price stability, which is critical for margin management.

Asked by Sneha Talreja

See, I will not revise the guidance. I think it's too early. I think if you see that we have grown this year, it's a bathwaresegment. We have just expanded to South and East in the past quarter. So that cost has come, but that sales will take some lag effect. So for the 9 months, the loss from the bathware segment is INR18 crores for the 9 months FY '26, so around INR6 crores per quarter. I feel that either September or December is when we should target to breakeven. So currently, team has been put in place pan-India now. And once South and East will also start delivering in terms of revenue, I think we should see next year will be key for Bathware.

Updates the timeline for the bathware segment to achieve breakeven, pushing it to Q3/Q4 FY27, acknowledging the lag effect of recent expansions and the current INR18 crores loss for 9M FY26.

Asked by Shivani Tanna

Anand Gupta: "Around 50% to 52% of our asset utilization is there on production capacity." (Page 13); Nihar Chheda: "That's about it. I think typically around 65% capacity utilization is when we would look at further capacity addition because last 4 years, we have done heavy capacity additions. And what you must realize is now we have significant land bank at Jaipur, Telangana and Begusarai. So we may not need more greenfield units in the short term." (Page 14)

Clarifies current capacity utilization (50-52%) and the threshold (65%) for considering future capex, indicating no immediate plans for major greenfield expansion due to existing land banks.

Asked by Aasim

So as you're aware, the competition in the industry has increased. With new capacities coming in, our focus is on growing volume growth. But with volume -- the way our industry is the more we grow, the more profitable we will be. So it's just out of prudence that we are saying 10% to 12%. But given decentralization benefits, improvement in product mix and operating leverage, margins can positively surprise next year as well. But I think we are just being slightly conservative.

Explains the rationale behind the 10-12% EBITDA margin guidance as conservative, acknowledging increased competition but highlighting potential for upside from product mix, decentralization, and operating leverage.

Asked by Keshav Lahoti