Note on Godrej Consumer Products and Balkrishna Industries Q2FY26 By Asit C. Mehta Investment Interrmediates Ltd
Godrej Consumer Products Ltd
* GCPL saw mixed performance in Q2FY26E. Topline was largely as estimated, while EBITDA saw 4% outperformance vs our estimates. PAT saw a negative deviation of 3%.
* EBITDA outperformance was due to lower employee costs and PAT underperformance was due to lower other income and extraordinary losses.
* ?Domestic business was impacted by GST related trade disruptions. International portfolio faced pressure in Indonesia while GAUM business saw robust growth.
* ?The company also ventured into Toilet cleaner category with homegrown ‘Godrej Spic’ and Men grooming category with the acquisition of brand ‘Muuchstac’.
Balkrishna Industries Ltd
* Balkrishna Industries reported a weak performance across all fronts, with Revenue/EBITDA/PAT missing consensus estimates by 10.8%/19.7%/27.1%, respectively.
* Standalone revenue (including realised FX impact) declined 5.9% YoY to Rs 23,207 mn, led by a 4.2% drop in volumes and a 1.8% decline in ASP, reflecting weaker US exports post-tariff hike and an adverse sales mix skewed toward domestic markets.
* EBITDA margin contracted 356 bps YoY / 223 bps QoQ to 21.5%, impacted by lower volumes, adverse mix shift toward domestic markets, and higher cost inventory build-up ahead of EUDR compliance.
* Absolute EBITDA declined 19.2% YoY/23.8% QoQ to Rs 4,999 mn.
* PAT declined sharply by 24.3% YoY and 7.9% QoQ to Rs 2,646 mn, primarily due to lower volumes, weak operating margins, and higher depreciation costs.
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