Borosil Ltd (BOROLTD) Q2FY27 Concall Transcript - Sep-2026 Qtr
Moderator (ICICI Securities Limited): Ladies and gentlemen, good day, and welcome to Borosil Limited Q2 FY '27 earnings conference call hosted by ICICI Securities Limited. As a reminder, all participant lines will be in the listen-only mode, and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during the conference call, please signal an operator by pressing star then zero on your touchtone phone. Please note that this conference is being recorded. I now hand the conference over to Mr. Manan Goyal from ICICI Securities Limited for the opening remarks. Thank you, and over to you, sir.
Manan Goyal (ICICI Securities Limited): Thank you. On behalf of ICICI Securities, we welcome you all to Q2 and FY '27 result conference call of Borosil Limited. Today, we have with us senior management represented by Mr. Ruturaj Sharma, CEO; Mr. Rajesh Kumar Chaudhary, Whole-Time Director; Mr. Anand Sultania, CFO; and Mr. Dhaval Patel, Head, Investor Relations. Now, I hand over the call to the management for their initial comments on the quarterly performance. Then, we will open the floor for Q&A session. Thank you, and over to you, sir.
Ruturaj Sharma (Borosil Ltd): Thank you, Manan, and ICICI Securities for arranging this call. Good afternoon to everyone of you. The Borosil team is delighted to be communicating with you once again. I'm pleased to inform you that Borosil Limited's Board has approved the financial results for Q2 FY '27 and H1 FY '27 during our Board meeting held on 29th October, 2026. We have submitted our results and an updated presentation to the stock exchanges, and they're also available on our company's website for your review. Some quick updates for Q2 FY '27 and H1 FY '27. I would like to highlight an important positive development for our borosilicate glassware business. Following the anti-dumping application filed by Borosil, the Directorate General of Trade Remedies, DGTR, in its final findings issued on September 24th, 2026, has conclusively established significant dumping of borosilicate tableware and kitchenware glassware from China, resulting in material retardation of the domestic industry. DGTR has recommended the imposition of anti-dumping duty for a period of five years, subject to notification by the Ministry of Finance. This is a significant milestone for Borosil, particularly in light of our substantial investments in establishing indigenous manufacturing capabilities. We believe that the implementation of the recommended duty will help restore a level playing field, improve capacity utilization and profitability, and create a more conducive environment for future investments, capacity expansion, and import substitution. We remain optimistic about the long-term growth prospects of this business while awaiting the government's final notification. We are pleased to inform you that the company, through its wholly owned subsidiary, Stilenas India Limited, has successfully commissioned setting up of BIS-compliant manufacturing unit with two double-wall lines for vacuum-insulated stainless steel flasks, bottles, and containers in the state of Rajasthan. The commercial production from the two double-wall lines commenced on 30th June, 2026, and the production from third double-wall line is expected to commence in January 2027. We have successfully commissioned captive ground-mounted solar power plant at Bikaner in three phases, aggregating to a total capacity of 35.8 megawatt-peak with a 16.9 megawatt-hour battery energy storage system. Consequently, solar power now meets approximately 60% of our overall power requirements, significantly reducing our dependence on conventional energy sources and strengthening our sustainability initiatives. The company has strengthened its direct-to-consumer retail presence with the launch of its first exclusive Borosil brand stores in Pune and Gurugram. These stores provide an immersive shopping experience, showcasing the company's comprehensive portfolio of kitchen, dining, home, and lifestyle products under one roof. The initial response has been encouraging with good consumer traction at both locations. This initiative is aimed at enhancing brand visibility, deepening consumer engagement, improving product discovery, and creating an additional channel for revenue growth. The company will leverage the learnings from these stores to progressively expand its exclusive retail network, strengthening direct consumer connect and long-term brand equity. I'm pleased to report that Borosil Limited delivered a healthy performance in H1 FY '27, with revenue from operations increasing to INR 627.4 crores from INR 576.8 crore in the corresponding period last year, registering a Y-o-Y growth of 8.8%. This growth, achieved despite challenging market conditions, reflects the resilience of our business model, the strength of our execution capabilities, and the continued trust and loyalty of our customers. It also reinforces our competitive positioning in the industry. The company delivered a significant improvement in operating profitability during H1 FY '27. Gross profit increased by 15.6% to INR 408.9 crores compared to INR 353.6 crore in H1 FY '26. Gross profit margin improved substantially by 390 basis points from 61.3% to 65.2%. EBITDA, excluding other income, increased by 20.5% to INR 107.7 crore from INR 89.4 crore in the corresponding period
Ruturaj Sharma (Borosil Ltd): half year. In response to the increase in fuel, raw material, and packaging material costs arising from the West Asia conflict, the company implemented price increases across broad categories. These measures, along with an improved product mix and continued focus on operational efficiencies, helped partially mitigate the impact of higher input costs and supported the improvement of, in overall gross and EBITDA margins. In H1 FY27, our other operating income stood at INR 24 crores on account of shared service support income and royalty income with the related expenses reflected in the total expenses. with other operating income of INR 16.2 crores in H1 FY26. Profit before tax for the half year was INR 16.3 60.3 crores versus INR 53.9 crores in the same period last year. The total other income of INR 4.4 crores in H1 FY27 includes rent income of INR 2 crores and investment income of INR 2.1 crores. While the total other income in H1 FY26 of INR 11.8 crores included rent income of INR 1.9 crores, investment income of about 2.2 crores, and a one-time stamp duty reversal of 7.2 crores, partly offset by professional fees of INR 1.6 crores. Depreciation and finance costs increased to INR 51.8 crores in H1 FY27 from INR 47.2 crores in H1 FY26, partly on account account of commissioning of two double wall Hydra lines. Overall profit after tax improved to INR 44.7 crores from INR 40.1 crores in H1 FY27 compared to corresponding period last year. The Consumer business delivered a strong improvement in operating profitability during Q2 FY27 and H1 FY27 driven by favorable product mix, improved sales realizations, calibrated pricing actions, and operational efficiencies across key categories. Domestic Appliances and stainless steel Cookware benefited from strong growth, premiumization, and improved operating leverage, while Glassware profitability improved through better product mix, higher realizations, and savings from captive solar power. These gains more than offset the significant input cost inflation arising from the West Asia conflict, particularly in Opalware where higher LPG, raw material, and packaging costs were only partially recovered through price increases as well as the initial ramp-up cost of the Hydra manufacturing facility. Overall, the improvement reflects the strength of our diversified product portfolio, disciplined pricing, and continued focus on operational efficiency. As on 30th September 2026, at the consolidated level, Borosil Limited maintained a strong balance sheet with investments, cash and bank balances of INR 67 crores against total debt of INR 162.8 crores, resulting into net debt position of INR 95.8 crores. Now, let's take a closer look at our category-wise performance for H1 FY27. Borosil's consumer division continues to expand both glassware and non-glassware categories under the Borosil brand along with the Opalware range under the Larah brand. The Larah Opalware segment reported sales of INR 210.7 crores in H1 FY27 versus INR 195.4 crores in H1 FY26, reflecting a 7.8% growth over same period last year. In our Glassware segment, which includes borosilicate microwavable, serving ware, glass tumblers, lunch boxes, and storage solutions, we recorded a year-on-year growth of 2.7% with revenues reaching 152.6 crores in H1 FY27 compared to INR 148.6 crores in H1 FY26. Here, the shift in the calendar for Diwali festival impacted the timing of seasonal demand and sales, resulting in Q2 FY27 and H1 FY27 sales and financial performance not being strictly comparable with the corresponding periods of the previous year. The Non-Glassware segment, comprising a diverse portfolio of small home appliances, insulated bottles and flasks, cookware, and other kitchen essentials, registered a strong growth of 10.9% with turnover increasing to INR 240.2 crores in H1 FY27 from INR 216.6 crores in H1 FY26. With the commissioning of two double wall Hydra lines, the company has been partially able to mitigate BIS compliance requirements. In Q2 FY27, our Hydra sales have improved by about 30% compared to corresponding quarter last year. Borosil is on a transformational journey to address key ESG opportunities and create long-term value for our customers.
Ruturaj Sharma (Borosil Ltd): On the similar lines to meet the power demand of Jaipur facility, we are setting up ground mounted solar power plant of 3 MW peak in Bikaner under Stylus India Limited with an estimated project cost of INR10 crores. This project is expected to achieve its commercial operations during Q4 FY27. These initiatives reinforced our commitment to sustainability, energy independence and long-term value creation. Considering the company's evolving business environment overall manufacturing strategy, it has decided to adopt an alternative approach to setting up a new glassware manufacturing project at Bharuch. Accordingly instead of the company setting up before and funding the facility directly, Borosil Scientific Limited will set up the facility at Bharuch Gujarat and incur the associated capital expenditure subject to requisite approvals. The company's long-term requirements for the relevant glassware products will continue to be met through the existing manufacturing arrangement with BSL. In Q4 FY26, the Board also approved the expansion of Borosilicate pressed glassware from 25 tonnes per day to 32 tonnes per day at Jaipur with addition of third forming line. The existing BG furnace was lit up in January '24 and is due for rebuilding in Jan '28 in the normal course of operations, whereas current furnace utilization level is 90%. Hence, the board approved expansion with third addition forming line with estimated capex of INR50 crores. This capacity expansion will help company to remove capacity bottlenecks, improve operating efficiency, lower production cost and enhance competitiveness. It will further help to improve product diversification and portfolio expansion. The project is progressing as per planned, is expected to commissioned by end of Q4 FY28. As part of our strategy to drive sustainable growth, we are strengthening the Borosil brand through a consumer centric approach, leveraging the consumer insights to identify opportunities for category expansion, improve product adoption, and enhanced market penetration. In glassware, our focus is on expanding usage occasion and driving growth in storage solutions while in appliances, we are prioritising stronger brand visibility, retail presence and portfolio awareness to accelerate consumer conversion. We have initiated a focused hero product communication strategy, led by the VitaRich slow juicer to drive product awareness, encourage healthier lifestyles and strengthen brand relevance in line with our philosophy Designed for a Better You. In summary, despite near-term challenges, Borosil strong brand equity, diversified portfolio, expanding manufacturing capabilities and growing omnichannel presence provide a robust foundation for sustainable growth. We remain focused on translating these strategic strengths into improved business performance, enhanced profitability and long-term shareholder value, reinforcing our confidence in the company's growth trajectory. With that, I would be happy to take your questions.
Moderator (ICICI Securities Limited): Thank you very much. We will now begin the question-and-answer session. Anyone who wishes to ask a question may press star and one on the touchtone telephone. If you wish to remove yourself from the question queue, you may press star and two. Participants are requested to use handsets while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. The first question is from the line of Sukrit D. Patil from Eyesight Fintrade Private Limited. Please go ahead.
Sukrit D. Patil (Eyesight Fintrade Private Limited): Good afternoon to the team. I have two questions. My first question to Mr. Sharma is our latest results show a big jump in the newer consumer products like home appliances, while our traditional glassware sales were a bit softer. As we push harder into these appliances, what is the biggest execution risk of moving away from our core glass business and how do you plan to protect our margin our market share if competitors start aggressively undercutting us on the price? That is my first question, I'll ask my second question after this. Thank you.
Ruturaj Sharma (Borosil Ltd): Yeah, hi. Sorry, I think if I understood correctly, you've said that our traction in appliances is higher compared to our glassware. Is that is my understanding correct?
Sukrit D. Patil (Eyesight Fintrade Private Limited): Yes.
Ruturaj Sharma (Borosil Ltd): So, you're right. In fact, the glassware appliances category has shown stronger growth compared to the glass to the glassware section. Two reasons, one is the glassware, you know, we are in the process of still seeding the market, expanding the portfolio and also our penetration in terms of distribution. Glassware, like we've said earlier also, despite our, if you look at the last two years what we have done with glassware, the utilization capacities and the tonnage and the category adoption has significantly gone up. And glassware compared to an appliance, like to like it's not fair to both equally, because appliance
Ruturaj Sharma (Borosil Ltd): terms of our daily use is far higher compared to glass. So, glass there is an adoption thing. And even having said that, we in fact are talking of again capacity expansion in glassware. So, like to like because appliances from a daily use perspective is an established category compared to glass. So, it seems that glass is performing slower, but so is not the case. If you look at the last two years and even this year adoption of glass has significantly improved in terms of our selling the tonnage also, in terms of revenue also. Specific to Q2, for example, because of the Diwali month calendar, you know, moving forward, it's the B2B impact comes in which gets covered going forward. So, that is how it is between the glass and the appliances thing.
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