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    Supreme Industries Q1 FY27 earnings call

    SUPREMEIND
    Capital Goods·28 Jul 2026
    Management Summary

    Supreme Industries Limited reported a mixed Q1 FY27, with revenue growing 4% to INR 2,718 crores and PAT increasing 17% to INR 208 crores, driven by an improved product mix and higher value-added product sales. However, the quarter saw a 14% overall volume de-growth, primarily due to polymer price volatility and inventory correction, particularly impacting the plastic piping and consumer product segments. Management remains optimistic for a strong recovery in H2 FY27, maintaining full-year volume and margin guidance.

    Highlights

    6

    • Revenue from operations increased 4% YoY to INR 2,718 crores despite volume de-growth.

    • Operating Profit grew 25% YoY to INR 398 crores.

    • Profit After Tax increased 17% YoY to INR 208 crores.

    • Overall margin improved due to a better product mix (lower low-margin pipe sales).

    • Value-added products turnover grew 22% YoY to INR 1,142 crores.

    • Strong growth anticipated in Q2 and for the full year, with July showing excellent growth.

    Concerns

    5

    • Overall volume de-growth of 14% in Q1 FY27 (1,57,536 tons vs 1,83,793 tons YoY).

    • Plastic piping system business de-grew by 15% in volume.

    • Consumer product segment de-grew by 22% in volume.

    • Q1 FY27 was impacted by "extraordinary volatility in polymer prices" and "inventory correction".

    • Agri growth was "definitely affected in April-June" due to price drops.

    Key financials

    Single quarter

    05 metrics
    1. 01Revenue from Operations₹2,718 Cr+4%YoY
    2. 02Volume Sold1,57,536 tons-14.0%YoY
    3. 03Operating Profit₹398 Cr+25%YoY
    4. 04Profit After Tax₹208 Cr+18%YoY
    5. 05Value-Added Products Turnover₹1,142 Cr+22%YoY

    Segment breakdown

    Volume GrowthValue Growth
    Plastic Piping System-15%0%
    Packaging Product-10%9%
    Industrial Product-6%24%
    Consumer Product-22%11%
    Heatmap· 2 shared metrics

    Capital allocation

    1
    high confidence
    CategoryHeadline
    Capex

    ₹500 crores this quarter · ₹1,000 crores (FY27) planned

    internal approval

    Guidance & targets

    8
    CategoryTargetPriority
    Volume
    Overall Volume Growth
    12% to 13%
    		High
    Volume
    Piping Division Volume Growth
    15% to 17%
    		High
    Profitability
    EBITDA Margin
    14% to 14.5%
    		High
    Capex
    Total Capex
    INR 1,000 crores
    		High
    Business Segment Revenue
    Gas Piping Business Revenue
    INR 600 crores
    		High
    Business Segment Revenue
    Window and Profile Business Revenue (Normal Utilization)
    INR 300-350 crores
    		Medium
    Exports
    Export Revenue
    USD 150 million
    		High
    Capacity Utilization
    Wavin Capacity Utilization
    70%
    		High

    What to watch in Q2 FY27

    5

    Overall Volume Growth

    Next quarter (Q2 FY27)
    Current-14% in Q1 FY27
    TargetRecovery towards 12-13% full-year guidance

    Why it matters

    Volume recovery is key to achieving full-year guidance and indicates market stabilization after Q1's inventory correction.

    I don't know, but we believe there will be good growth in second quarter also. And July is only one month of the three months. We are seeing excellent growth in the month of July and we believe the growth will be quite good in the second quarter, which you will know in the month of October.

    Risks & concerns

    3
    RiskSeverity

    Polymer Price Volatility

    The first quarter was impacted by extraordinary volatility in polymer prices, particularly during April 2026, leading to inventory correction and temporarily affected industry demand. — Management acknowledged

    high

    Industry-wide Volume De-growth

    The company experienced a 14% overall volume de-growth in Q1 FY27, attributed to industry-wide inventory correction due to uncertain and dropping prices. — Management acknowledged

    medium

    Slow Ramp-up of Composite Cylinder Business

    The composite cylinder business is not a stock-and-sell item, implying that time lost in manufacturing as per specific designs and orders cannot be recovered, leading to a slower ramp-up. — Management acknowledged

    low

    Q&A highlights

    8

    “I think the whole country declined in plastic, all plastic had a de-growth because it was very uncertain, prices were dropping from the high price of the March month, the prices started getting corrected. So the whole pipeline of the all the industry must have been gone into inventory correction mode.”

    Explains the reason for Q1 volume decline (industry-wide inventory correction due to price volatility) and confirms it was not company-specific.

    asked by Sneha (Nuvama)

    2 min read6 chapters

    Detailed Narrative

    01

    Q1 FY27 Performance Overview

    Supreme Industries Limited reported Q1 FY27 revenue from operations of INR 2,718 crores, a 4% increase year-on-year, despite an overall volume de-growth of 14% to 1,57,536 tons. Operating profit saw a significant 25% increase to INR 398 crores, and Profit After Tax grew 17% to INR 208 crores. This margin improvement was attributed to a favorable product mix, with lower sales of low-margin plastic pipes.

    02

    Business Segment Performance and Challenges

    The plastic piping system business experienced a 15% volume de-growth, remaining flat in value terms, while the consumer product segment saw a 22% volume de-growth but an 11% value growth. Packaging products de-grew 10% in volume but grew 9% in value, and industrial products de-grew 6% in volume but grew 24% in value. The overall turnover of value-added products increased by 22% to INR 1,142 crores, indicating a shift towards higher-margin offerings.

    03

    Market Conditions and Demand Outlook

    The first quarter was significantly impacted by "extraordinary volatility in polymer prices," particularly in April 2026, leading to industry-wide inventory correction and temporarily affected demand. The agri segment was notably affected in April-June due to steep price drops. However, management noted that polymer prices are now stabilizing, and channel inventory is being restocked, with "excellent growth" observed in July and good growth expected in Q2 FY27.

    04

    Capacity Expansion and New Initiatives

    The company is progressing with its planned capital expenditure of INR 1,000 crores for FY27, having committed INR 500 crores so far. This includes establishing new manufacturing facilities in Bihar, Jammu, and Malanpur, as well as acquiring additional land in Pondicherry and Erode. An investment of INR 220 crores has been made in the window and profile business, which is expected to generate INR 300-350 crores in revenue at normal utilization. The gas piping business is projected to achieve around INR 600 crores in revenue this year.

    05

    Export Strategy and Long-Term Growth

    Supreme Industries has ambitious export plans, aiming to increase export revenue from USD 26 million to USD 150 million over the next six to seven years. This strategy involves targeting countries with Free Trade Agreements (FTAs) and participating in international exhibitions. The company sees a vast opportunity in the global plastic granules market, which was valued at USD 41 billion last year, compared to their current USD 5 million export.

    06

    Financial Position and Margin Guidance

    The company maintains a robust financial position, funding its growth plans and working capital requirements through internal accruals. For the full year FY27, Supreme Industries maintains its guidance of 12-13% overall volume growth, with 15-17% growth in the piping division. The EBITDA margin guidance for FY27 is maintained at 14-14.5%, which management described as a "conservative" and "responsible" projection.

    This is an AI-generated summary of a publicly available earnings call transcript.