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    Sahyadri Industr

    SAHYADRI
    Construction Materials·13 Aug 2025
    Management Summary

    Sahyadri Industries reported a mixed Q1 FY26, with revenue stabilizing at ₹216 crore and strong sequential growth, but a YoY decline in profitability metrics. EBITDA stood at ₹21.7 crore (10.1% margin), while PAT was ₹10.8 crore (5% margin). Capacity utilization improved to 93%. The company faces challenges from geopolitical instability and input costs, but expects 8-10% topline growth and improved margins for FY26, despite delays in its Palghar expansion project.

    Highlights

    4

    • Total income stabilized at ₹216 crore in Q1 FY26, showing a strong 41.6% QoQ growth.

    • EBITDA improved 56.7% QoQ to ₹21.7 crore, with EBITDA margin at 10.1% (up from 9.1% QoQ).

    • Capacity utilization increased to 93% in Q1 FY26 from 89% in Q1 FY25, indicating operational efficiency.

    • Management anticipates 8-10% topline growth for FY26 and better margins due to cost optimization and pricing adjustments.

    Concerns

    4

    • Total income saw a marginal decline of 0.8% YoY in Q1 FY26.

    • EBITDA declined 12.7% YoY to ₹21.7 crore, and EBITDA margin contracted to 10.1% from 11.4% YoY.

    • PAT declined 13.8% YoY to ₹10.8 crore, with PAT margin contracting to 5% from 5.7% YoY.

    • Land acquisition delays for the Palghar facility have pushed the commissioning timeline to Q4 FY27.

    Key financials

    Single quarter

    06 metrics
    1. 01Total Income₹216 Cr-0.8%YoY
    2. 02EBITDA₹21.7 Cr-12.7%YoY
    3. 03EBITDA Margin10.1%
    4. 04PAT₹10.8 Cr-13.8%YoY
    5. 05PAT Margin5%

    Capital allocation

    1
    high confidence
    CategoryHeadline
    Capex

    ₹100 crores

    Guidance & targets

    6
    CategoryTargetPriority
    Capacity
    Palghar facility commissioning
    Q4 FY27
    		Medium
    Capex
    Total investment for Palghar facility
    ₹100 crore
    		High
    Revenue
    Topline addition from Palghar facility
    ₹125 crore
    		High
    Revenue
    Topline upside for FY26
    8% to 10%
    		High
    Volume
    Non-asbestos business growth
    double
    		Medium
    Margin
    Operating margins
    better than what we have already given for the year
    		Medium

    Palghar facility land acquisition progress

    next quarter
    Current1-2 parcels pending, getting sorted out
    TargetResolution of pending land parcels

    Why it matters

    Crucial for adhering to the revised Q4 FY27 commissioning timeline for the new facility.

    There is 1 or 2 parcels of the land which is in between, it is getting sorted out.

    How to verify

    capital_allocation.capex.purposes

    Risks & concerns

    5
    RiskSeverity

    Geopolitical instability and its impact on global trade and commodity flows

    Affects input costs, supply chain, and freight charges, particularly for imported asbestos fiber. — Management acknowledged

    medium

    Elevated input costs and rupee depreciation

    Increased costs for imported asbestos fiber and other inputs, amplified by rupee depreciation, putting pressure on manufacturing costs and operating margins. — Management acknowledged

    high

    Limited ability to pass on cost increases to consumers

    Especially in the price-sensitive rural housing segment, leading to pressure on operating margins. — Management acknowledged

    medium

    Land acquisition delays for Palghar facility

    Delaying the commissioning of the new facility to Q4 FY27, impacting future capacity and revenue addition. — Management acknowledged

    medium

    Uncertainty in dollar-rupee movement

    Makes it difficult to predict import-related expenses and overall business environment. — Management acknowledged

    medium

    Q&A highlights

    4

    “As we stated earlier, there is a delay in land acquisition and still it is going on particularly in the Palghar facility and the revised timeline for that is Q4 of FY'27 and the total investment would be around Rs. 100 crore and out of which Rs. 50 crore is already spent and once this line is fully operational, roughly Rs. 125 crore would be the addition into the topline.”

    Provides specific details on the Palghar expansion project, including revised timeline, total investment, spent amount, and expected revenue contribution.

    asked by Kaustav Bubna

    2 min read5 chapters

    Detailed Narrative

    01

    Q1 FY26 Performance Overview

    Sahyadri Industries reported a total income of ₹216 crore in Q1 FY26, marking a marginal decline of 0.8% year-on-year but a robust 41.6% growth quarter-on-quarter. EBITDA for the quarter stood at ₹21.7 crore, translating to an EBITDA margin of 10.1%. While EBITDA declined 12.7% year-on-year, it saw a significant 56.7% increase quarter-on-quarter. Profit After Tax (PAT) was ₹10.8 crore, a 13.8% year-on-year decline, but a substantial 152.2% quarter-on-quarter growth, with a PAT margin of 5%.

    02

    Industry Landscape and Challenges

    The Indian asbestos-based roofing sector continues to face a complex environment. Key challenges include geopolitical instability impacting global trade, elevated input costs (especially for imported asbestos fiber), supply chain disruptions, increased freight charges, and the depreciation of the Indian rupee. These factors have led to heightened price volatility and exerted pressure on manufacturing costs and operating margins, compounded by a limited ability to pass on cost increases to price-sensitive rural consumers.

    03

    Operational Efficiency and Capacity Utilization

    Despite the headwinds, Sahyadri Industries demonstrated resilient operational performance. Capacity utilization improved to 93% in Q1 FY26, up from 89% in Q1 FY25. This indicates better utilization of existing assets, contributing to the sequential improvement in EBITDA and PAT, even amidst weak demand and ongoing pricing pressures.

    04

    Capacity Expansion and Non-Asbestos Business Strategy

    The company's Palghar facility expansion faces delays due to land acquisition issues, with the revised timeline for commissioning now set for Q4 FY27. This project involves a total investment of ₹100 crore, with ₹50 crore already spent, and is expected to add roughly ₹125 crore to the topline upon full operation. Sahyadri is also focusing on its non-asbestos business, which includes fireproof and waterproof products, with an aspiration to double this segment's contribution within the next 3 to 4 years.

    05

    FY26 Outlook and Guidance

    For FY26, Sahyadri Industries anticipates a path to recovery, driven by a good monsoon, stabilizing global supply chains, and improved price realization. Management expects a 'roughly 8% to 10% upside in the topline' for FY26. They also project that operating margins will be 'better than what we have already given for the year,' supported by cost optimization and pricing adjustments, despite ongoing challenges.

    This is an AI-generated summary of a publicly available earnings call transcript. It is for informational purposes only and does not constitute investment advice, a recommendation, or an endorsement. inve.money is not a SEBI-registered investment advisor. Please consult a qualified financial advisor before making any investment decisions.