Good morning, everyone. I welcome you all to the earnings conference call to discuss Q4 and FY26 results of Prince Pipes and Fittings Limited.

To discuss the result, we have from the management Mr. Parag Chheda, Joint Managing Director; Mr.

Nihar Chheda, Vice President, Strategy; and Mr. Anand Gupta, Chief Financial Officer.

They will take you through the results and the business performance, after which we will proceed for Q&A session. Before we proceed with the call, I would like to mention that some of the statements made in today's call may be forward-looking in nature and may involve risk and uncertainties.

For more details, kindly refer to investor presentation and other filings that can be found on the company's website. With this, I now hand over the call to the management for their opening remarks.

Thank you and over to you, sir.

Thank you, Sumeet. Good morning and thank you all for joining us for our Quarter 4 and FY26 financial results.

The presentation and the press release have been issued to the stock exchanges and uploaded on our website. I hope everyone has been able to go through the same.

FY26 was a challenging year for the industry, shaped by volatile raw material prices, extended unseasonal rainfall, and subdued demand across key end-user categories. Additionally, significant fluctuations in PVC prices disrupted channel sentiment and created added uncertainty across the value chain.

Despite these external headwinds, our focus remained steadfast on strengthening operational resilience while consistently advancing our long-term strategic agenda. We achieved our highest ever quarterly volumes, delivering a healthy volume growth of 23% YoY in Quarter 4.

For the full year FY26, our volume growth stood at 8%. This performance reflects the resilience of our business model, the strength of our brand and distribution ecosystem, combined with unwavering emphasis on operational efficiency, cost optimization, and focused growth initiatives.

Innovation and portfolio diversification continue to be the key drivers of our long-term growth journey. During the quarter, we further expanded our product portfolio with the launch of Decilo, an advanced low noise PP pipe solution.

Engineered with mineral-filled polypropylene technology, Decilo delivers superior strength, durability, and chemical resistance while significantly reducing noise and improving flow performance. Designed specifically for modern infrastructure needs, this innovative solution is expected to enhance our product mix, deepen customer engagement, and reinforce our value proposition across key stakeholder groups.

Alongside product innovation, we intensified our demand generation efforts in underpenetrated markets to expand our geographic reach and accelerate volume growth. These strategic initiatives are enabling us to enhance competitiveness, remain agile in a dynamic marketplace, and strengthen our customer-centric approach.

Facing sharp increase in polymer prices during this quarter, the company passed on inventory gains to the distributors and channel partners, thereby fostering distributor relationships and supporting faster inventory movement, which in turn enhanced working capital efficiency and reduced inventory holding costs. I am also delighted to share that we successfully completed the second phase of our asset purchase agreement with Klaus Waren Fixtures Limited for the strategic acquisition of the bathware brand Aquel.

The acquisition includes land, building, machinery, manufacturing equipment, and associated infrastructure at Bhuj, Gujarat, which will serve as a dedicated manufacturing base for our bathware operations. This strategic milestone significantly strengthens our diversification roadmap, expands our manufacturing capabilities, and positions us strongly to scale the Aquel portfolio in the growing bathware segment.

We also continue to strengthen our market footprint across high potential regions. During the quarter in our bathware segment, we inaugurated a new experience center in Vadodara, Gujarat, further enhancing our customer outreach, market visibility, and brand positioning.

These strategic investments reflect our commitment to establishing Aquel as a meaningful growth engine within our diversified business portfolio. Looking ahead, we remain cautiously optimistic about a gradual recovery supported by improving PVC price stability.

Our continued focus on expanding geographic presence, accelerating innovation, enhancing operational efficiencies, and driving strategic diversification gives us confidence in our ability to navigate uncertainties effectively. We remain committed to capitalizing on emerging opportunities, delivering sustainable long-term growth, and consistently creating enhanced value for all our stakeholders.

In conclusion, despite external headwinds, we are confident that our strong fundamentals, diversified product portfolio, and customer-centric approach position us well for a sustained long-term growth. Thank you for your time.

I will now hand it over to our CFO, Mr. Anand Gupta, to take you through the key financial highlights.

Thank you, Parag, and good morning, everyone. I'll be taking you through the Quarter 4 and FY26 financials now.

Starting with quarterly highlights, revenue from operations stood at ₹850 crores, a strong growth of 18% YoY. Our volumes for the quarter stood at 62,167 metric tons, a robust growth of 23% YoY.

EBITDA for the quarter stood at ₹110 crores, an exceptional growth of 100% YoY, while margin stood at 13%, registering a 500 basis point growth. Profit after tax for the quarter stood at ₹56 crores, a remarkable growth of 133% YoY.

PAT margin for the quarter stood at 7%, a 400 basis point growth. Now for the full year FY26 highlights, revenue from operations stood at ₹2,598 crores, it grew by 3% YoY.

Our volumes for the full year FY26 stood at 1,91,238 metric tons as compared to 1,77,202 metric tons same period last year, a growth of 8%. EBITDA for the full year stood at ₹232 crores, up by 43% YoY, while margin stood at 9%.

In FY26, we have taken an exception of ₹2.05 crores net of tax towards estimated increase in provision for employee benefits arising from the implementation of the new labor code. Profit after tax after exceptional items stood at ₹73 crores, registering a healthy growth of 70% YoY.

PAT margins stood at 3%. During the year, we maintained strong momentum in expanding our distribution network and further strengthened our product portfolio through the addition of new products to support long-term growth.

Our working capital efficiency improved significantly in FY26 driven by sharp reduction in inventory and receivable days. Working capital days stood at 45 days in FY26 compared to 98 days in the corresponding period last year.

Receivable days improved to 51 days from 61 days in the same period last year, while inventory days stood at 70 days as of 31st March 2026. With this, I now end my speech and open the forum for question-and-answer session.

Thank you, sir, and first of all, congratulations on robust performance across the board. Couple of questions, sir.

First, will try to get a broader guidance and then we'll try to come to understand what supported such a robust performance. Now, from here on for '27, '28, how one can look at on the volume growth and on the margin front?

Thank you for your question. I think if you have to look at guidance for next financial year or current financial year rather, I think EBITDA should be closer to our normal guidance of in the band of 11% to 13% for the full year.

There could be few quarters of inventory gain and loss, but annualized, we see 11% to 13% kind of operating margin, and 12% to 15% kind of a volume growth.

Okay. First, try to understand that this quarter, the entire growth that we have seen, 23% kind of a growth, if you can bifurcate both on the CPVC, PVC front, and also maybe at a couple of places as you highlighted that you try to penetrate the market to get the volume, and also at the same time, in April and May given the volatility in the CPVC prices, and now again we are seeing again it is increasing, how the volume is there in April and May till now?

Whether that kind of a momentum is there?

If I look at the fourth quarter, the encouraging thing is that the volume growth was robust across the three months. Of course, the disruption due to the war happened in March month.

Even if I look at the first 60-day period of the quarter, the volume growth was extremely high and in line with the overall volume growth of the quarter. First thing I would like to highlight is January, February, March, all three months, we have seen high volume growth.

This has been a reflection of the aggressive pricing that we have now done, and also in March, we passed on the inventory gains to the channel partners to ensure that they are also competitive in the market. We are not interested in one or two quarters of inventory gain, but we are interested in sustainable increase of market share, which in such times of volatility, it becomes easier for a large player like us to gain market share when we have a strong supply chain of raw material.

We have seen many such cycles and I think few players tried to pass on costs overnight, which we felt was not the right strategic decision. That actually paid off because in April, we saw a strong correction of prices also.

Our channel partners had inventory and in April they have also done destocking. Our channel partners have not faced heavy inventory losses like the channel partners of other industry players have.

As a result of that, we have not only improved our retail penetration, but we have also been able to add a lot of key channel partners in the past couple of months from smaller players and from some peers as well. Coming to your question of category-wise volume growth, CPVC continues to be our highest growing polymer followed by PVC, PPR, and HDPE.

We see that trend going forward in the current financial year as well.

April and May also we are witnessing the way we are looking at 12%, 15%? Broadly, directionally, I'm not asking the specific number, but directionally the same momentum is there.

The main point is whatever the price increase which has happened in the Q4, obviously that would have helped all the companies to shift the inventory from company to the dealers. Actually now whether actual demand is happening from dealer to the customer level or not, that's the point I'm trying to understand.

I'll answer your question in two parts. First is April, of course, we saw heavy destocking and April volumes were obviously not good.

In May, we have seen a strong primary pickup because dealers have been able to liquidate their material. As a company, we have also shifted our focus from being a primary-oriented organization to now being a secondary-oriented organization.

What I mean by that is a strong focus on increasing retail penetration, and a lot of our schemes are now purposed towards the retailers where we are able to do direct bank transfers from the company directly to the retailers to ensure that whatever market share gains are there are more sustainable in nature. We have added thousands of retailers in the past couple of quarters, and as a result of that, now our dealers are able to liquidate material at a faster rate and hence that will also improve primary volumes in the long term.

I hope that answers your question.

Lastly, in terms of margin, now obviously it's a good to see that we are again saying 11% to 13%. Hopefully we should be kind of a middle level we should be able to achieve.

The point I want to understand is that obviously also if you can specify in Q4 what was the inventory gain, and the prices which have fallen since 1st April and some ₹4 hike has happened in May. Broadly, directionally, can we see there will be a inventory loss and maybe Q1 one can see a much lower margin and then from Q2 onwards we should be witnessing the kind of a margin improvement or the way you said that you did not pass on the prices so fast, so that the current margin, what we are trying to achieve, 11%, 13%, broadly should be on a quarterly basis also should be in the similar range?

No. One, if you're able to see, our working capital management has been very strong, specifically from disciplined inventory.

We have guided for 65 to 75 days of inventory and we are in that range as we speak. What this means is not only better capital management, but also means that any inventory gain or loss shocks will be very, very low and range-bound from here on.

We have done this since the past couple of quarters. In Q4, inventory gain was, I would say, close to zero because it was passed on to the channel, which is why we were able to deliver a 23% kind of a volume growth.

Going forward, even if there is, I'm not saying there will never be inventory gain or loss, that is nature of the business, that will happen, but it will be extremely range-bound, which was not the case in the past. I will be candid enough to say we have learned from our mistakes and now we have an extremely tight control on inventory, as a result of which on an annual basis, the core profitability of the company will be very apparent.

Quarterly there could be up and down, but on an annual basis it will definitely even out from here on. Specifically to answer the margin part, apart from inventory gain or loss, the mix of value-added products is very, very important.

Our focus has been on growing CPVC, PPR, and apart from that, now we have also started in-house manufacturing of low noise polypropylene pipes, complete in-house manufacturing, and state-of-the-art, best-in-class quality products that we have known as Decilo. From this year onwards, revenue contribution from Decilo also would start, which will help improve product mix, and as a result, help gross margins also improve in the long

term. Great, sir.

Thank you and all the best.

Thank you.

Hi team, congratulations for great numbers and thanks a lot for the opportunity. Couple of questions from my end.

One, you said that you're looking at margin sustaining between 11% to 13%. What I'm able to understand is you said that you don't have any inventory gains in this particular quarter.

Could you tell us the reason why your margin then on a quarter-on-quarter basis or even compared to nine months basis have improved substantially, and what is the reason that it could sustain at around similar levels?

In Q4, we did not have any inventory losses, Sneha, and in the first nine months, of course, we had huge inventory loss. Three reasons.

One is no inventory loss. Second is very strong volumes, record high volumes for the company of 62 kt per quarter, so that obviously got in a lot of superior cost absorption.

Third is a very strong product mix, specifically coming in from CPVC and PPR for the fourth quarter. Product mix, operating leverage, and lack of inventory loss helped us have a strong operating margins in the March quarter.

Understood. Your confidence on volume growth path, Nihar, are we seeing strong demand uptick at this point of time on the agri side, plumbing side?

Where is demand coming from? Because volatility in PVC still continues.

Volatility in PVC continues. April was weak for the industry because channel partners had high inventory.

Because our finished good was competitively priced, even what we sold in March, the secondary sales of channel partners continued to be strong in April, which is why from May we have seen strong demand across plumbing and agriculture, but specifically for us anyway plumbing and drainage is 2/3 of the portfolio. That part of the demand continues to be strong in the current month.

We foresee that over the next couple of months and beyond that also demand should remain strong for the larger players, because what we have also seen is significant consolidation. In the kind of volatility that we saw not only in fourth quarter, but even the nine months before that, small players were struggling because of the large inventory losses and subdued demand environment.

Then in the fourth quarter, when there was a kind of a chaos of the war and one-way increase in prices, smaller players were not able to serve the demand. As a result of which, we also had market share gains and lot of new distributors also we have been able to add.

We see consolidation also happening at a faster pace in the past year, and we should yield those dividends in this short-term and long-term future.

Sure. One last one, Nihar, if I may, with regards to distribution network.

You said that you added distribution network. Could you tell us how many distributors you would have added net-net in this particular year?

Also, in case you can highlight because you're going more towards the retail, is there any loss of distribution network also in this year?

No, I think net-net we have had addition of distributors and especially what is encouraging is in our white spaces, which were typically weaker markets in some pockets of South and East India, and as well of our stronger markets of North, Central, and West, across we have been able to add distributors in white spaces during this kind of volatility.

Hello. Hi, thank you for the opportunity.

Firstly, congratulations on a strong set of numbers. I wanted to get a sense, last quarter I remember the EBITDA margin guidance was 10% to 12%.

Now in a way you have upgraded it to 11% to 13%. The reasons for the same, you have a better confidence on margin now?

Secondly, this margin guidance is including or excluding bathware losses?

It is including of all and would not read too much into it. I think that is The call is no longer being recorded.

Am I audible?

You're audible.

I think the margin guidance is in that same range, I would not read too much into it. I think we are confident of achieving that kind of a 11%, 12% kind of EBITDA including the bathware losses.

Understood, got it. Sir, how was the channel inventory being during Jan to March and April?

Just wanted to, without getting in numbers, possibly because as you highlighted there has been destocking in April, whether due to destocking, the volume have degrown?

April was challenging for the entire industry, which was expected due to high restocking in March. Over the past 12 months and we continue to focus a lot on improving our retail penetration and improving our sustainable market share at a secondary level.

As a result of which, in May, we have seen a strong revival and a strong demand in the first 15 days of the month, which will continue for the rest of the quarter and for the time ahead as well.

Got it. Sir, as you launched your own CPVC brand four, five months back, how are the things going on that side on both margin side and the volume growth?

Can you give some sense how has been your CPVC volume growth for Q4 and as well as for FY26?

Volume growth has been higher than what our company volume growth is. That for the annual year, it is 8%, for the quarter, it is 23%, and this has been higher for CPVC.

Post our own brand of Smartfit Plus in CPVC, we have seen extreme competitiveness in our finished good, which was a conscious strategy, and as a result of which, we are seeing the market reward us in terms of better acceptance across retail and projects. We have made better than what we had expected in the first couple of quarters after leaving Lubrizol.

We have seen a very strong volume growth and we believe that this will continue going forward.

Understood. Secondly, as your prices are more competitive, I understand you have passed on the gains also.

You have passed on entire gain or possibly this is also aiding you in better margin also?

It is one of the levers which is helping us improve margin as well. We have retained some of the benefits, but most of the benefits have been passed on with a view to gain market share in CPVC.

One last question from my side, how has been the

Hi. I just wanted to understand that our sales volume has grown at just 5.7% Hello?

at just 5.7% CAGR over the last six years, and our EBITDA margin is around 9% band for the last four years. Just wanted to get a sense as to what has changed at the industry level that gives us the confidence of giving such a robust guidance on both volume and margin front?

If you see last year, we have posted volume growth of 8%. If you see March quarter, we have posted volume growth of 23%.

We are seeing immense consolidation in the industry where not only smaller players are struggling, but some of the larger players are also struggling because of lack of control on the market. As I have stated, we have added a lot of new products along with that added a lot of new channel partners due to this consolidation, and as a result of both, we believe that the kind of growth that we have had in the past year, we will be able to build on that for the next couple of years.

Okay. Sir, how has been our agri pipe demand in Q4 and how it is shaping up in the current quarter?

We are majorly a plumbing and drainage pipe company. Agri is less than 30% of our revenue.

Agri tends to be more price sensitive than the plumbing. Our bandwidth is purely on the plumbing and drainage portfolio where there is better level of brand consciousness and we can keep adding new products, focusing on adding channel partners, and grow the business.

Agri is important from a cost absorption and reach, especially in rural India point of view, I would say that demand has been healthy, but majorly the demand tailwinds have been in the building material part of the portfolio.

Okay. Sir, last question, how is the competitive intensity in the plastic pipe sector?

Earlier, we were providing incentives to dealers because of the competitive pressure. Can you just quantify whether there's been any change in the incentive structure in the current quarter?

Also, if you can quantify the incentive amount which we're currently providing to our dealers?

Like I said, I think competitive intensity has reduced from a point of view that consolidation has happened. Of course, large players like us continue to be aggressive in terms of pricing and the incentives that we give to the channel, but we see that if we are aggressive in pricing, the market is rewarding us with volumes because we are seeing immense consolidation with smaller players also moving out of the market and some of the larger players also struggling.

We see that this is a very good time for someone like us who has put up capacity ahead of the curve to be able to make some sustainable market share gains across our product portfolio.

Hi, sir. Thank you for the opportunity.

Sir, could you just quantify the bathware revenue and losses for this quarter?

Revenue is ₹16 crores and loss is ₹5 crores for this quarter.

Okay. Sir, on the working capital, we saw fair bit of increase in the payable days as well, and reduction in debtor days.

How sustainable is this kind of working capital? I just wanted to understand what is our sustainable debtor days and payable days that we are aiming for?

You mentioned about the inventory days, but other two.

See, what is in our control is debtor days and inventory days, and I believe any sustainable decrease in working capital days and further optimization can come only from these two levers. Payables is a function of whether we are importing more or buying domestic raw material, it's always going to be dynamic.

Any sustained decrease in working capital can come only from debtors and inventory, which we have seen in the March quarter. Debtor days now has come to around 50 days, which used to be around 60 days.

Our endeavor is to bring this further down by another 10 to 15 days by the end of this financial year.

Okay. Sir, on the gross margin front, is there any thought process how much do we wish to maintain?

Obviously we can reduce the price further, but on a per kg basis or percentage basis, that kind of gross margin on a PVC side, how much we want to maintain?

See, there are three or four levers for gross margin. One is, of course, the pricing.

Apart from that, which is also the product mix and more contribution from value-added products like CPVC, PPR, now PP, will be helpful going forward. Our management bandwidth is towards how do we increase our share of value-added products.

Third is also we would have long-term decentralization benefits as well with now our large plant in Bihar. We will have a lot of freight savings, which right now we have passed on to the channel, but eventually once we hit the right capacity utilizations, these benefits also will accrue to the company at the gross margin level itself.

I think pricing, product mix, and decentralization benefits and new product initiatives, I think these are the four levers to have strong control on gross margin going forward.

That I understand. Sir, any thought process we want to have this much of markup on PVC?

This quarter we didn't pass on, next quarter suppose there is so much decline, is there any per kg kind of a value add we want to mark up that we want to sustain?

No, I don't think we see it from that perspective. That's a function of demand and supply for that particular quarter, and also a function of how our costing is of raw materials at that time.

It's a function of multiple variables.

Okay. Sir, lastly on the

Hi, sir, and many congratulations for a good set of numbers. My first question is related to the capacity utilization.

I understand the Begusarai facility has now full capacity we have with us. The utilization is on the lower side.

If I exclude that as well, our utilization is not at the full level, 50% odd level is the utilization if I just excluding Begusarai. Geographically give some indication that's the ramp up of your capacity way forward?

In fact, Bihar our capacity utilization is healthy as we speak. Kind of a 60% kind of a utilization we have already hit at Bihar.

Few other plants, we are working towards improving utilization, and that's obviously a direct function of market share. Traditionally, South has been a market where we have lagged our peers, and lot of capacity expansion have come in South, but maybe the market share growth has not been in line with the capacity expansion.

Further focus will be towards growing South market, which is a huge market, and couple of the large players in South are struggling. There is a opportunity to ramp up utilization, and once that happens, I think overall at a company level as well the utilization numbers will be much better.

Thank you. Next question is related to the RM procurement.

If you can highlight how is your strategy of a domestic, international RM procurement, or the continuous from the large players or to some import dependency from the trader? How is the mix and the strategy for the RM procurement?

We want to be extremely disciplined with inventory management, which we have already shown in the last financial year. When there is a very tight control on inventory, especially in these volatile times, we have a strong supply chain so as to we never have material insecurity.

Even when there is non-linear surge in demand, we should have the ability to serve that, especially with the kind of capacity we have. We need to balance between tight inventory days and a strong supply capability, which we have demonstrated in the past year and the past quarter.

With our current mix of domestic and import, we would be able to keep our inventory in the 65 to 75 days range. This includes both raw material and finished goods.

Thank you, sir, and all the best.

Thank you.

Good morning, sir. Sir, my first question is regarding the plumbing pipe demand at the industry level.

What we are seeing that there has been a significant increase in the prices of the construction material across the board. Are you seeing any signs of slowdown in the pace of new projects on the ground?

Can you also give some sense for the plumbing pipe demand at the industry level how it is shaping up in the rural and the urban pockets?

We have seen good growth across urban and rural. Yes, I would acknowledge that there is a sharp escalation of costs for real estate developers.

Till now, we have not seen any kind of postponement of demand. Pipe anyway is a non-discretionary product for any building materials, for any building.

I would say any slowness in real estate will be sort of subsidized by the kind of consolidation we are seeing in the industry. I think larger players in piping will continue to do well, and that is why we are optimistic about the current financial year kind of growth that we can see in the plumbing and SWR pipes.

Okay. Sir, quickly lastly on the gross asset turn side, sir, prior to the COVID, we were hovering at around 3x on the gross asset turn, which has now gone down to around 1.5x or 1.6x in FY26.

Just wanted your sense what should be a normalized gross asset turn on a sustainable basis and by when you expect to reach to that level? What would be our capex guidance for this fiscal year, for FY27?

As Nihar had mentioned that the South plant has not been operating at the optimal level, if we consider that to reach at optimal level, our turnover should be around 2.5x of the gross block, that should be decent enough. With that, we will be around 60% to 65% of our overall utilization.

The capex which you asked about, FY27 plan, it will be in the range of ₹200 crores, which includes capex to maintain for our existing plant and some of the debottlenecking plan which we have for our two or three plants. That includes the completion of Aquel as well, which happened in April, so that includes ₹40, ₹45 crores is included in ₹200 crores, ₹200, ₹210 crores.

Okay. Sir, this 2.5x gross asset turn which we are targeting, by when we can expect to reach to that level?

Maybe a certain timeframe, over next 3 years, 5 years?

Correct. It would be over the long term.

Thanks a lot, sir.

Hi, I am Sonal Minhas. I hope I'm audible.

Yeah.

Sir, I just wanted to understand your working capital cycle from the context of creditors. When the last PVC cycle was up after FY20, in FY21 and '22, when the prices were up, we saw a surge in your creditor days and we see it again now.

Is there something to read here in terms of buying behavior? Who are your creditors, basically?

Just wanted to understand that.

I don't understand the question.

I'll repeat again the question, sir. We saw an increase in your creditor days in FY21 as per the chart given on slide number 9, in FY21 and '22.

We are seeing a surge again in FY26. Is there something to read here?

Back in '21 and '22, the PVC prices were again up and hence, just trying to make sense of this data.

No, I don't think there is any correlation to it.

Okay. All right.

Can you just explain who are your creditors? Are they very concentrated creditors, creditor lines, or are they some vendors who are large or small, if you could explain that?

We have Reliance, Chemplast locally, and then we import from across the globe, North America, Japan, and

Got it, sir. Got it.

Thank you so much, sir. Firstly, a very good congratulations on a good set of numbers.

Sir, my first question is how does our pricing today compare versus the market leaders in PVC and CPVC?

In PVC and CPVC, we are both at par with the market leader in terms of pricing. It could vary from geography to geography, but at a pan-India level, pan-India average, we would be at par in PVC and in CPVC.

Okay.

Sir, my next question is what is the steady state of the margin, the operating margin profile for us? What should be steady for us, what percentage margin, for operating leverage?

At an annual level, 11% to 12% kind of operating margin.

Okay. Sir, one last question, sir.

Over the last 3 years, they've lost volume market share. What was the primary reason behind that, and what sort of plan we have going forwards?

See, yeah,

I would not say that we have lost market share. Our growth has been slower than couple of peers, but has always been higher than industry average.

Yes, there was scope to have better volume growth, but we have not lost market share, which if you see the past couple of quarters, now we are back on track in terms of volume performance. Going forward, basically focus remains on network expansion, adding new not only distributors, but adding new retailers across the country, having direct retailer schemes where company has direct bank transfers to lakhs of retailers across the country, a strong pipeline of new products which are value-added in nature, which we will completely manufacture in-house.

It's going to be a function of network expansion, stronger retailer penetration, innovative products which help us improve our range and our product mix over the long term, and of course, a consistent investment into brand building activities across the country.

Okay.

Hello, am I audible?

Yes.

Hello?

Yeah.

Sir, if you can share the total inventory gain for the quarter and how much was retained and how much was passed on to the channel?

We have had no inventory gains in Quarter 4. It has been passed on to the channel to improve our competitiveness

in the market. That was completely passed on?

Yes. Yeah.

Secondly, you stated that the demand was strong in throughout the quarter, in Jan, Feb, and March. Can you share the underlying reason what has driven this demand throughout the quarter?

One, in the first two months, we saw stability of pricing, which was helpful. Then, of course, in March, we saw a upsurge in pricing.

One is we had tailwinds as far as raw materials was concerned, and apart from that, I think I've already stated the initiatives that we are taking in terms of expanding the market reach and expanding our new product portfolio.

Understood. Thank you so much.

Thank you.

Hi. Am I audible?

Yes.

Yeah. My question is regarding the capacity utilization.

For the annual year, what was the capacity utilization, is around 60%, you said? So

60% was mentioned for the new plant which we operated for nine months, I'll say, on a capacity what we have built in. For overall, the number is around 52%.

52%?

Yeah. On production capacity, 52%.

Okay. You said the volume growth or the operating leverage this time around for this quarter, what was the capacity utilization before, in quarter 3, and what is its utilization in quarter 4?

Just trying to understand the operating leverage in terms of volume is also grown. What has benefited in the margin side?

How much operating leverage we've got this time for this quarter?

I cannot quantify operating leverage like that. In Quarter 3, you see we have done 42 kt, and Quarter 4 we have done 62 kt.

Obviously, in terms of net revenue also there is a large increase primarily driven by the volume growth. As a result of that, there is superior cost absorption.

As most of our costs are fixed or semi-variable in nature. As a result of which, we have strong operating leverage.

With better volume growth, we will always have better cost absorption.

What is the guidance on increasing the capacity utilization from here on, 50%, 52%? What is the constraint here to not able to take it maybe on 60%, 65%, or 70% on a overall basis?

We have already guided for 12% to 15% kind of volume growth, and our aspiration is much higher than that. We do have the capacity.

We are also building stronger infrastructure. This year, we will be doing some capex towards improving our storage capacities across plants, which will further help us increase our supply chain and our utilization.

The point is you need to understand that demand does not increase in a linear way. There is always going to be a non-linear upsurge in demand.

If you see how Prince has become one of the top players in the piping segment, one of the core reasons has been putting up capacity ahead of the curve and having that risk appetite to put up that capacity. First couple of years, it can look like low utilization, but then whenever there is a uptrend in demand, we are able to serve it.

I think Quarter 4 also is a testament to that. We're a debt-free organization with a very robust balance sheet, and we are extremely bullish on the growth that India will see, and specifically in building material, infrastructure, agriculture, and water storage, the verticals that we operate in.

We are extremely bullish over the long term. We don't look at quarter-to-quarter kind of demand scenarios.

We are adding capacity with an extremely long-term view, and we do have the risk appetite and the strength of the balance sheet to be able to take these calls. We're extremely optimistic in our ability to deliver that kind of volume over the long term.

Thank you, sir. Sir, on the bathware front, last time we were saying that we will be having a break-even in Q2 or Q3 of FY27 when we will be reaching a ₹25 to ₹30 odd crore quarterly run rate.

Is there any change in stand there?

No, I think Quarter 2, Quarter 3 of next financial year of FY27, current financial year, is what we target to hit that kind of run rate. We have done around ₹16 crores in fourth quarter, and at around ₹20, ₹25 crores we will hit that break-even mark.

Got it. Sir, Anand sir has mentioned that we will be having a two, three plants debottlenecking.

Just trying to understand, current installed capacity of 4,35,000 odd, how much one can look at by end of FY27, and maybe FY27 also some 5, 10,000 kt increase?

This is only for certain product categories at certain plants, and this also includes some civil investments that we are making in terms of state-of-the-art warehouse management at our plants. That during lean periods we still are able to ramp up inventory so that during the season we are able to deliver that kind of volume.

The debottlenecking is specific to couple of plants only for specific product categories where we feel that we need to do some slight debottlenecking. Majority of the capex is towards maintenance, improve storage capability, and the Aquel acquisition, which was already completed in the past month.

Okay. Sir, broadly in terms of the value-added, if I have to look at in terms of the share in revenue, for Q4 or maybe FY27 our FY26 what's the broader share, and how as you said that even Decilo will also start increasing the revenue, just trying to understand how this share will keep on moving going forward?

This would be in the range of 23%, 24% in FY26, and this has to move towards 27% to 28% next year. I don't like to look at it in terms of contribution because our core segment of PVC also we will be growing.

It's just that the rate of growth will be higher in the value-added segment. Basically, improvement in value-added contribution will come from stronger growth in CPVC, PPR, and with the Decilo launch.

I think by next year, we should hit 27%, 28%.

Hi management. Thank you for the opportunity, and income.

The company has mentioned about adding a lot of dealers during this quarter and during the year. Could you explain how has been the dealer trend over the last few years and what is likely to be the trend going forward in terms of the exact numbers on how many we had, and are we expanding that team in terms of dealer acquisition and all of that?

Could you just shed light on that group?

The yield per distributor can vary. We have distributors doing ₹50 lakhs per annum, and we have distributors doing ₹100 crores per annum.

Number of distributors may not be the right correlation. What's important is adding the right distributors who have the right infrastructure, right retail network, ability to invest in the business, and more importantly, we want to add distributors in white spaces, which are weak markets, weak districts which we have mapped out at a taluka level.

Adding that right reach of distribution is important with the right kind of partners. Specific numbers may not be as important, but the reach has significantly increased and will continue to increase as the industry has seen major consolidation.

We have strengthened our sales team in terms of numbers as well to ensure that we have a better reach of the network in the long term.

I understand that. I was just curious because of the numbers, because I understand broadly it can be very varied in terms of numbers.

In terms of the sales channel expansion and all of that, I was just curious numbers would be easier for us to understand than just a broad-based guidance on strengthening. Would that be possible to give some numbers?

I think offline you can connect with us, and happy to share.

Understood. In terms of the inventory going forward, you just mentioned the fact that we've normalized, we're going to reduce the amount of overall basis and reduce the working capital.

Could you explain where do you see the inventory and overall working capital side normalize, specifically in terms of inventory? Where do you see it going forward for the next one year and the next few years also?

Where do you want it to come to?

I think already we are in control as far as inventory, inventory we are normalized. 65 to 75 days has been our guidance, and we are within that guidance.

This includes both finished good and raw material inventory. Any sustainable decrease in working capital has to be driven by disciplined inventory and reduction in debtor days, which is, I would say, a KPI for the management and the CXOs.

Currently, we are at around 50 days, and we would like to reduce this by another 10 days in the next four quarters.

Hi, sir. Thank you for taking my questions.

What capex are we planning for this year?

Around ₹200 to ₹210 crores is the planning for FY27. That includes the second tranche of Bhuj as well.

Sir. What utilization are we expecting to end the year with?

Of the production capacity, we intend to have around 58% to 60% if the guidance of 15% we achieve to get the volume.

All right, sir. Thank you.

I just wanted to understand so what is the ratio of projects business to your overall business?

I think as we've said, it is around 70-30, 70 retail and 30 projects.

What could have been the growth of projects business since say last quarter?

See, quarter to quarter, we would not track the ratio, but I think over the maybe around one and a half, two years ago, projects used to be around 25%, which is now around 30% of the revenue.

Okay. Just a general question on how is the overall demand scenario in the building material sector?

Considering the results which other pipe companies have posted, electric wire companies have posted, tile company has posted, look like building material has kind of turned around after let's say seven, eight quarters. Is that the case or is it just a temporary demand because of this volatility in prices of raw materials?

Dealers are stocking up. What is your opinion on that?

Of course, we have seen restocking. Like I said, that restocking happened only in March because of the price increases.

Even in January and February, we had strong volume growth because of our price competitiveness and the initiatives that we've taken in terms of expanding our distribution channel, retail channel, and our product portfolio. Yes, 23% is not sustainable.

Of course, the restocking has a part to play in that. Overall, we are seeing a lot of these initiatives that we are driving along with consolidation where larger players are doing well and smaller players are going through extremely tough times.

Any kind of volatility, both upward and downward, is tough for the smaller players to survive. So

In terms of if you're tracking secondary sales, primary, I understand, there's been a growth of 23% in volume. What would it be in terms of secondary sales?

Secondary sales also we have seen strong growth, and especially even in April when primary was weak, we have seen that distributors have been able to liquidate material into the retail market aggressively. Because we shared our inventory gains, we have seen even when prices reversed in April, distributors were able to liquidate material.

As I said, smaller players are still having supply issues over the past couple of months. Big players will continue to get bigger from here.

Thank you. Thank you, and all the best.

Thank you.

Thank you, everyone.