Company Update : Pidilite Ltd By Motilal Oswal Financial Services Ltd
In line performance; Volume led growth sustains
Consolidated performance
* PIDI’s consol. sales grew 8% YoY to INR31.4b (est. INR31.4b).
* Underlying volume growth remained strong at 9.8% (est, 9.7% in 3QFY25). UVG was 8% for C&B businesses and 16.4% for B2B businesses.
* Consumer & Bazaar (C&B) segment’s revenue rose 7% YoY to INR23.9b (est. INR26.6b), with segmental EBIT rising 13% YoY to INR6.2b (est. INR6.8b). Segmental EBIT margin expanded 150bp YoY to 25.8%.
* B2B segment’s revenue grew 14% YoY to INR8.1b (est. INR5.3b), with segmental EBIT rising 69% YoY to INR1.4b (est. INR0.5b). Segmental EBIT margin expanded 570bp YoY to 17.5%.
* Gross margin expanded ~160bp YoY to 55% (53.2% est), led by moderate RM prices.
* Employee expenses increased 22% YoY and other expenses rose 7% YoY.
* EBITDA margin improved 20bp YoY to 20.1% (in line).
* EBITDA grew 10% YoY to INR6.3b (est. INR6.3b).
* PBT grew 20% YoY to INR6b (est. INR5.7b).
* Adj. PAT increased 20% YoY to INR4.5b (est. INR4.4b).
* In FY25, net sales, EBITDA, and APAT rose 6%, 11%, and 17%, respectively.
Subsidiaries
* Domestic subsidiaries posted double-digit revenue and EBITDA growth YoY.
* Sales of international subsidiaries (excluding Pidilite USA and Pulvitec Brazil) were flat YoY.
Other takeaways
* A&SP spending increased to drive demand generation (4QFY25: 5.4% of Net Sales; 4QFY24: 4.7%; 3QFY25: 3.9%).
* Despite the challenging macroeconomic environment and demand conditions, PIDI has delivered a strong underlying volume growth with healthy margins.
* Management remains cautiously optimistic about improved demand from a good monsoon, an increase in government spending, and increased construction activities
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