Greenply Industries Ltd (GREENPLY) Q2FY27 Concall Transcript - Sep-2026 Qtr
Moderator: Ladies and gentlemen, good day, and welcome to the Q2 FY '27 earnings call of Greenply Industries, hosted by Asian Market Securities Private 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. I now hand the conference over to Mr. Karan Bhatelia from Asian Market Securities Private Limited. Thank you, and over to you.
Karan Bhatelia (Asian Market Securities Private Limited): Thank you, Nasaya. Welcome to the 2Q FY '27 investor call of Greenply Industries. From the management side, we have Mr. Sharanndhya Mittal, JMD; Sanjiv sir, CFO. I now hand over the call to Sharanndhya for his opening remarks, post which we'll open the floor for Q&A. Thank you, and over to you, sir.
Sanidhya Mittal (Greenply Industries Ltd): Thank you, Karan, and good morning, everyone. It is a pleasure to welcome you all to Greenply Industries Limited earnings conference call to discuss our financial and operating performance for Q2 H1 FY '27. During the first half of the year, we continue to strengthen our portfolio to enhance customer engagement through technology-led, through technology-led innovate-- and focused brand-building initiatives. In our premium Hello? Am I audible?
Karan Bhatelia (Asian Market Securities Private Limited): Yes, sir, audible. Please go ahead.
Sanidhya Mittal (Greenply Industries Ltd): Okay. In our premium plywood portfolio, we introduced Termi-Vac, a patented nano-technology-based anti-termite solution designed to provide an enhanced long-lasting protection against termite attack, addressing a key concern for consumers across the country. We've also strengthened Greenply Gold's value proposition through introduction of the 11-year Fully Covered Plus plan, which complements its 30-year old product warranty by providing specific restoration and related cost coverage to bring in customer trust and customer delight. Our product innovations and performance showcased in MATECIA 2026 across our product categories was highly appreciated by all. Through targeted engagement with architects, designers, dealers, and other key stakeholders, supported by interactive product demonstrations, we focused on strengthening brand visibility, driving product awareness, and reinforcing our product positioning in the value-added and premium product segment. These initiatives are aimed at supporting customer preferences, improving product mix, and driving driving sustainable product profitable growth. The above initiatives, coupled with our continued focus on product innovation and targeted efforts across product categories and customer segments, have started yielding encouraging results. Initial feedback from dealers, architects on our premium product offering and innovation has also been encouraging. The positive response is translating into healthy value growth and reinforces our confidence in the premium strategy. Going forward, we believe sustained momentum in the premium category, supported by continued product innovation and a strong product mix, will contribute to margin expansion and enhance overall profitability. Furthermore, given the healthy growth momentum in the plywood segment and our objectives of meeting the incremental demand through our own manufacturing capabilities, we are pleased to announce the expansion of our plywood manufacturing capacity at our existing Sandila, Lucknow location. The proposed new capacity will be 15 million square meters with a budgeted CapEx of Rs. 125 crores, which will be funded through mix of debt and equity and is expected to commence commercial production in Q4 FY '28.
Sanidhya Mittal (Greenply Industries Ltd): The expansion will strengthen our ability to serve the growing market while supporting our long term growth plan. With this expansion, our total plywood capacity starting Q4 FY '28 will be 81.3 million MSM. Moving on to our ESG and sustainability initiatives. I am proud to highlight a major milestone in our green journey. Greenply has undertaken one of India's largest private sector afforestation program, a framework, a verified carbon standard, VCS, validated, grouped project titled, "Agroforestry Plantation in the Country by Greenply." We have successfully rolled out the first phase across Gujarat and Nagaland, covering an area of over 2,300 hectares and transforming degraded scrub scrublands and low productivity agricultural plots into thriving agroforestry ecosystems. This initiative is deeply collaborative. We have already benefited over 505 local farmers through sapling distribution, hands-on training, technical support to boost their long-term profitability. Furthermore, participating farmers will directly benefit from a share of the revenue generated from the sale of carbon credits. I'm also thrilled to share that a total of 2,56,688 carbon credits have officially been allotted to Greenply under this program. Looking ahead, we are fully committed to to moving into the second stage of the project, which will expand our footprint to massive 12,000 hectares across both Gujarat and Nagaland. This framework underscores our commitment to blending strong environmental stewardship with robust socio-economic value for our grass root communities, paving the way of sustainable long-term growth. Now, I would like to update you on Greenply Q2 and H1 FY '27 financial and operating performance. Consolidated revenue for Q2 FY '27 stood at 799.7 crores, registering 16.1% year-on-year increase. Our consolidated core EBITDA stood at 89.2 crores with a core EBITDA margin of 11.2%, re- representing an expansion of 300 basis points YoY growth. On a half-year basis, consolidated revenue stood at 1,524.6 crores, registering a 18.2 YoY increase. Our consolidated core EBITDA was 167.5 crores with a core EBITDA margin of 11%, representing an expansion of 180 basis points YoY growth. Let me now share the highlights of our individual business segments. In our plywood segment, we've achieved a volume growth of 6.1% on YoY basis in Q2 FY '27 with a revenue of 625.7 crores, a value growth of 15.5% on a YoY basis. The realization stood at rupees 264 per square meter due to better sales of premium products. On the margin front, our core EBITDA margin stood at 10.05 for Q2 FY '27, a growth of 180 basis points YoY and 160 basis over the last quarter. On a half-yearly basis, we've achieved a volume growth of 9.2% on a YoY base on a YoY basis, with a revenue of 1,152.3 crores, a value growth of 15.7% on YoY basis. The realization stood at rupees 264 per square meter. On the margin front, our core EBITDA was at 9.31 for H1 H1 FY '27, a growth of 120 basis points on a YoY basis. Moving to our MDF business. We've achieved a quarterly revenue of 173.9 crores with volumes reaching 54,605 CBM. This reflects a YoY growth of 18.4% in value and 16.1% in volume terms. The reason for not achieving the targeted growth in the quarter was mainly due to some challenges faced due to monsoons and annual maintenance. The realizations declined to 3 31,816 per CBM due to roll back of the price hikes taken earlier. EBITDA margin for the quarter stood at 15.2%. On a half-yearly basis, we've achieved a revenue of 369.6 crores, a growth of 25.6% on a YoY basis, with volumes reaching 1,12,411 CBM, a growth of 20.4% on a YoY basis. The realization stood at 32,694 CBM.
Sanidhya Mittal (Greenply Industries Ltd): on a half-yearly basis was 16.3%, a growth of 350 basis points on a Y-o-Y basis. Our furniture fittings and our furniture fittings JV, we have achieved a sales of 14.08 crores in Q2 FY '27 and 27.70 crores on a half-yearly basis. The JV reported a PAT loss of 12.6 crores in Q2 FY '27, with our share of the loss amounting to 6.3 crores. On a half-yearly basis, the JV reported a PAT loss of 24.2 crores with our share of loss amounting to 12.1 crores. Our HDF flooring line commenced commercial production in July 2026 and is progressing well. We expected this business to begin contributing to our overall performance only in the second half of FY '27 as operations ramped up. Our expansion ramped up, sorry. Our expansion projects, including the new MDF facility at Vadodara and the new greenfield manufacturing facility at Odisha, are progressing well and as planned remain on track for commissioning with the committed timelines. MDF is expected to commence in Q2 FY '28 and plywood in Q4 FY '27. On the balance sheet front, we continue to maintain a prudent financial position while investing for future growth. As of the end of the quarter, our consolidated net debt stood at INR 544 crores, a net debt-to-equity ratio of 0.56x. This remains within our guided range of 0.7 to 0.75x.
Moderator: Participants, please stay connected. The management line has been dropped.
Moderator: Ladies and gentlemen, thank you for your patience. The management line has been connected.
Sanidhya Mittal (Greenply Industries Ltd): Management line?
Sanidhya Mittal (Greenply Industries Ltd): On the balance sheet front, we continue to maintain a prudent financial position while investing for future growth. At the end of the quarter, our consolidated consolidated net debt stood at 544 crores, with a debt-to-equity ratio of 0.56. This remains well within our guided range of 0.7 to 0.75x, reflecting our disciplined capital allocation, healthy financial position, even as we continue to execute our planned capital expenditure program. Looking ahead, considering our H1 FY '27 performance and the overall market environment, we intend to maintain our existing guidance for the plywood segment and remain remain confident on achieving it. For the MDF segment, considering the external operation operating environment and strategic focus on value-added products and profitability, we revisited our earlier whole-year guidance. And we expect to achieve full-year volume growth of approximately 20% while maintaining core EBITDA margins in the range of 15% to 16%. We remain focused on delivering sustainable growth, improving operating efficiencies and strengthening our market positions across our key product categories. With this, I would like to now open the floor for Q&A. Thank you.
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