Composite surge masks QoQ momentum loss; guidance maintained

Transcript states 29.3% composite growth in Q1

PAT growth 22.2% YoY supported by EBITDA +15%, but QoQ PAT declined -12.2%

Order book cited; coupled with ₹400 Cr packaging orders for FY27

Value-added product share only 25.4% vs prior target of 35% in 2 years

Cycle time 110 days in Q1 vs target 90 days; deteriorated from 100 days in Dec 2025

Target 35% of sales in 2 years; currently only 25.4%. Composite order book ₹185 Cr supports growth but mix not yet achieved

Deteriorated to 110 days from 100 days in Dec 2025 due to polymer price spike; target remains 90 days

Maintained +1.75% annual increase plan; March 2026 was 19%, targeting 24% in 3 years (by March 2029)

Achieved ₹12 Cr this year; targeting ₹35 Cr if all operating states adopt green power policy

Reaffirmed >15% volume growth, 25-30% composite growth, 19-20% EBITDA growth, 23-24% PAT growth; no change

Working capital cycle at 110 days due to March polymer spike; target 90 days by year-end. On cash deployment: following board/investor guidelines; open to organic/inorganic growth if ROCE >target. Buyback and dividend payout ratio increase also under consideration from FY27 onwards.

75% customers on monthly pricing (8-12th of each month). Major increases March-April fully passed on; July decreases (₹23 Cr) passed with 1-month lag. With 3-month lag, no net pricing gap. 25% other products (composites) with 6-month inventory carry fixed pricing.

Q1 soft due to government not passing EPC contractor cost increases; Q2-Q3 recovery expected. Reasonable crude $70-80/bbl (oil producer needs $55 profit); implies polymer $1,100-1,250. At normalized levels, EBITDA margin 14-15.5% is sustainable.

Normally 50-50 domestic/export. Within domestic: entirely PSU (HPCL, IOCL, BPCL). Non-PSU only legacy (Reliance repurposing old stock); not current supply.

Cost of funds 8.5% India / 6.5% overseas. QIP proceeds in FD; interest netted off, not in other income. Other income ₹1 Cr (rental income only). Finance cost ₹35-40 Cr on non-fund-based facilities (bank guarantees, LC, documentation); not debt interest.

Composite 25-30%, PE pipe 20-25%, packaging 11-13%, others 10-12%. Combined 15%+ growth

Assumes normalized polymer prices. Driven by automation, power cost savings (₹12-35 Cr), manpower reduction, finance cost decline

Q1 delivered 13.3%; depends on commodity stabilization and monthly pricing pass-through effectiveness

Includes ₹28 Cr maintenance, ₹47 Cr value-added this Q. Automation, new capacity (Gujarat, Odisha, Chiplun, Saudi), recycling expansion

Polymer prices $600-1,800 range historically. 20-25 day pass-through lag creates margin compression risk if prices spike suddenly

Q1 PE pipe volumes weak due to government not passing cost increases to EPC contractors. H2 dependent on rains ending and project resumption

Cycle time 110 days vs 90-day target; deteriorated from 100 days in Dec 2025 due to raw material price spikes and inventory carry

Value-added products (composite, IBC) only 25.4% of sales; two-year target 35%. Margin expansion strategy partially behind

Ongoing geopolitical tensions affect raw material pricing, shipping costs, export demand (Ebullient 60% export to Middle East). Macro uncertainty caps guidance from price perspective