KAJARIACERNSEMay 8, 2025

Kajaria Ceramics Limited

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Management on call

Ashok Kajaria

CHAIRMAN AND MANAGING DIRECTOR

Chetan Kajaria

JOINT MANAGING DIRECTOR

Rishi Kajaria

JOINT MANAGING DIRECTOR

Kartik Kajaria

HEAD, ADHESIVES

Sanjeev Agarwal

CHIEF FINANCIAL OFFICER

Parveen Gupta

DEPUTY VICE PRESIDENT, FINANCE

Pranav Mehta

EQUIRUS SECURITIES PRIVATE LIMITED

Kartik Kajaria. From The Finance Team We Have Mr. Sanjeev Agarwal

CFO; and Mr. Parveen Gupta – DVP

Key numbers — 40 extracted

Rs. 1,227 crore

the Senior Management Team of Kajaria Ceramics. Our consolidated revenue for the quarter stood at Rs. 1,227 crores, including Plywood, indicating a 1% year-to-year decrease compared to the corresponding period l

r consolidated revenue for the quarter stood at Rs. 1,227 crores, including Plywood, indicating a 1% year-to-year decrease compared to the corresponding period last year due to low tile volume growt

witnessed a very soft demand in the domestic as well as export market. We grew our tile volume by 2% in Q4 F’25. In the full Financial Year we have attained a 6% volume growth, reaching 115 million

t market. We grew our tile volume by 2% in Q4 F’25. In the full Financial Year we have attained a 6% volume growth, reaching 115 million square meters. The EBITDA margin for Q4 25 stood at 10%. The

115 million

volume by 2% in Q4 F’25. In the full Financial Year we have attained a 6% volume growth, reaching 115 million square meters. The EBITDA margin for Q4 25 stood at 10%. The reasons for the decline in margin ar

10%

ined a 6% volume growth, reaching 115 million square meters. The EBITDA margin for Q4 25 stood at 10%. The reasons for the decline in margin are another muted quarter of the Bathware division, some l

50%

d to close this devision. Our Nepal project, which commissioned in September ‘24, has operated at 50% utilization in Q4 ’25. India’s tile exports have experienced a 20% fall in value in Financial Yea

20%

September ‘24, has operated at 50% utilization in Q4 ’25. India’s tile exports have experienced a 20% fall in value in Financial Year ‘25 to Rs. 16,000 crores versus Rs. 20,

Rs. 16,000 crore

ion in Q4 ’25. India’s tile exports have experienced a 20% fall in value in Financial Year ‘25 to Rs. 16,000 crores versus Rs. 20,000 crores last year. This was largely attributed to increased freight rates due t

Rs. 20,000 crore

d a 20% fall in value in Financial Year ‘25 to Rs. 16,000 crores versus Rs. 20,000 crores last year. This was largely attributed to increased freight rates due to the Red Sea crisis and

Rs. 1,088 crore

d. Now for this quarter’s segment-wise financial performance. Tile segment remained flattish at Rs. 1,088 crores compared to Rs. 1,092 crores in Q4 F'24. The Bathware segment registered 8% year-to-year growth

Rs. 1,092 crore

egment-wise financial performance. Tile segment remained flattish at Rs. 1,088 crores compared to Rs. 1,092 crores in Q4 F'24. The Bathware segment registered 8% year-to-year growth in revenue reaching Rs. 111 c

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Guidance — 20 items

Ashok Kajaria

opening

“We had set up Plywood division in 2017, hoping that due to implementation of GST there will be a shift from unorganized products to branded one.”

Ashok Kajaria

opening

“Our Nepal project, which commissioned in September ‘24, has operated at 50% utilization in Q4 ’25.”

Ashok Kajaria

opening

“We hope that these measures should make us more competitive and grow much better than industry, and result in improving margins going forward.”

Rahul Agarwal

“I just wanted to know how did the industry pan out overall on domestic side and your outlook on domestic and export sales for the next year.”

Rahul Agarwal

“What do you think about next year in terms of outlook, any comments, qualitative also will help?”

Rahul Agarwal

“And do you see a revival in exports next year?”

Rahul Agarwal

“Because I think the cheaper crude should help going forward, so any outlook on fuel pricing bit?”

Rahul Agarwal

“Would you say that we will have a cheaper fuel price going forward, like next year versus this year?”

Ashok Kajaria

“Because prices are related to Brent, as you know Brent is slightly lower right now, but it's difficult to make a commitment for next year.”

Sonali Salgaonkar

“And this will be across Bathware and tiles?”

Risks & concerns — 15 flagged

1,227 crores, including Plywood, indicating a 1% year-to-year decrease compared to the corresponding period last year due to low tile volume growth and decline in Plywood sale.

— Ashok Kajaria

The reasons for the decline in margin are another muted quarter of the Bathware division, some loss in UK operations and provision of doubtful debts in the Plywood division, as we have decided to close this division.

— Ashok Kajaria

Because prices are related to Brent, as you know Brent is slightly lower right now, but it's difficult to make a commitment for next year.

— Ashok Kajaria

Overall, the demand was weak overall across India.

— Ashok Kajaria

Last quarter you had also mentioned that there was a certain amount of pressure on realization because the project share had increased.

— Sneha Talreja

And just earlier participant’s question on Bathware, I know you spoke there's no one-off, but broadly what will be the PBT margin or EBITDA margin, because I believe incrementally there was thought that this drag because of new plant will gradually reduce as utilization improves.

— Rishikesh Bhagat

Basically I wanted to understand on the competitive intensity in the marketplace, given the demand is weak, how is Kajaria approaching the marketplace?

— Ritesh Shah

If demand is weak then we won’t have sold what we sold.

— Ashok Kajaria

So demand is not weak, demand is normal.

— Ashok Kajaria

So sir, like in terms of the competitive intensity, majorly we would have seen the pressure in which part of this segment?

— Amar Maurya

And sir, I mean, we are of the view that the competition from Morbi has terrified and that is the reason majority of the organized players are basically having a volume decline or volume slowdown.

— Amar Maurya

It's difficult to say, difficult to predict.

— Chetan Kajaria

How the industry will grow, it's very difficult to predict.

— Chetan Kajaria

It's difficult to tell you any numbers right now.

— Ashok Kajaria

So can you please explain the reason for sharp margin pressure in the tile segment on a Q-on-Q basis?

— Utkarsh Nopany

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Q&A — 20 exchanges

Hi, sir. Good evening. Thank you for the opportunity. And good to see the balance sheet discipline in a very tough environment, so congratulations on that. Sir, two questions I had. Firstly to start with, on industry growth versus what Kajaria has done, for full year Kajaria grew 6% on volumes. I just wanted to know how did the industry pan out overall on domestic side and your outlook on domestic and export sales for the next year. That's the first question.

Ashok Kajaria

Rahul, industry should have grown by about 2%, 3% in the Financial Year which ended in March ‘25 domestically. And as I said, exports have degrown by 20% in Financial Year ‘25. What do you think about next year in terms of outlook, any comments, qualitative also will help? You see two things; the market is still muted. But at Kajaria with all these things what we are planning, we should do much better than the industry. And do you see a revival in exports next year? Exports should definitely go up. With the things easing out worldwide and also the freight rates are the lowest today, so with th

Sir, thank you for this opportunity. Sir my first question is a little broad based, so how do you see the real estate cycle panning right now? And even in the past two to three years when the real estate cycle was sort of steady, on the tile industry, and this is more of an industry level question, I know we have grown faster than the industry. Why are we still seeing, as an industrial, a single-digit volume growth in tiles?

Ashok Kajaria

See, as far as Kajaria is concerned, as I said, we are now unifying our entire operations over a period of next six months to nine months. And with this, I think things should be much better as far as we are concerned, and we should do better than the industry. So in the real estate market, as we said earlier also, our turn is we are T + 2. So I think now this year I think things should be much better. If the industry grows, in real-estate if there's a boom in the market, if things are all good, I think we should definitely get a good share of the market. Understood. But right now the real-est

Yes. Good evening, everyone. So my question is, sir you have been guiding and forecasting an X growth for your company which you have not been able to achieve. So when the management guides something to the investors, we really rely on that. And when obviously you are not being able to achieve those numbers brings a lot of disappointment. I just wanted to understand what is the reason of this forecast failure at your end.

Ashok Kajaria

No, you are absolutely correct. We have been guiding for the last three years we have not been able to perform, I agree, on behalf of the management. And as I said just now to Sonali that this year we are not guiding and will perform. See, Mr. Sejal, one thing is there, the promoter is always optimistic. So by giving guidance, he is always bullish. And it happens or not, it is not in our hands some time, or in this time this has been, we will agree that for three, four years what we have been guiding we have not been able to do. So that is why we are refraining ourselves from giving any guidan

Good evening, team. And thanks a lot for the opportunity. Just a couple of questions from my end. Just extended to one of the previous participant’s question in terms of the real estate cycle, I would rather want to know where exactly was the weakness, was it across Tier-1, Tier-2, Tier- 3 markets or was it related to project and retail segment? In case we can get some color on that along with liquidity situation now on ground.

Ashok Kajaria

See, the whole industry did not grow at all. Industry literally grew at about 2%, 3%. We still did better than the industry. Going forward we hope that the industry grows and we will perform much better than them. Yes, this is the industry level question only that the demand you are saying was across the Tier- 1, Tier-2, Tier-3 and even in projects in the retail market, I mean, that's the color that I wanted. Correct, correct. Overall, the demand was weak overall across India. Okay. And now we are expecting improvement, any specific areas of Tier-1, Tier-2 projects, retail, any specification t

Hi. Good evening. So on Plywood, fair to assume that most of this impairment in the quarter is done, now there's nothing pending so in the subsequent quarter it will --

Sanjeev Agarwal

Sorry, Rishikesh, 98% we have done, so only Rs. 2 crores, Rs. 3 crores will come in the first half, that will be the salary of the people who are remaining with the company. So apart from that, we have taken everything in this financial year. So you are not going to see any surprise in the next quarter or year as far as price is concerned, except Rs. 2 crores, Rs. 3 crores expenses, or maybe some under provision or over provision of debt, small. And just earlier participant’s question on Bathware, I know you spoke there's no one-off, but broadly what will be the PBT margin or EBITDA margin, be

Hi, thank you for the opportunity. So we can see your JV has turned in profitable, we can see some Rs. 17 million profitability, is it due to Nepal JV?

Ashok Kajaria

Sorry? You right now loss, but this time it is Rs. 70 million profit for this quarter, is it due to Nepal JV? No, no, no, nothing to do with the Nepal JV, Nepal number is very, very small. So what is that Rs. 70 million pertaining to for this quarter? 70 million means Rs. 1.7 crores? Rs. 7 crores. Sorry? Rs. 7 crore or Rs. 70 million. In consolidated we can see Rs. 7 crores profit from JV. That I think there was some entry reversal of some earlier period this year. So this profit belongs not to this quarter for some anti-reversal by the auditor in this quarter. Understood. Got it. And Nepal, y

Yes. Thank you for the opportunity. So my first question is related to the capacity. And if I look at your production number, with the capacity you are at some 97% of utilization. So if any growth will come the way forward, how are you looking at the volume number to shape up, especially from the own manufacturing and the subsidiaries?

Rishi Kajaria

So, our own manufacturing and subsidiaries are operating at almost 97%, 98%. But plenty of material is available in Morbi. So as we go along, whatever material we require, we can always outsource from there. So that is not an issue. And related to that, sir, one just a clarification, because last year the growth number if I look at is of around 6%, but the production number is quite higher comparatively. And quarter-on- quarter from the last four quarters we are continuously seeing your production number is quite a higher as compared of the sales numbers. So why actually this production number

Yes. Hi, sir. Thanks for the opportunity. Sir, I have a couple of questions, one is, earlier we had indicated that we were creating specific teams for government projects. And last year we had done around 10% of the volumes, the number indicated for this year was around 12% to 13%. So, just wanted to get a gist where we are on that number and how do we see this number going forward?

Ashok Kajaria

Last year the number was close to about 4%, out of Rs. 100 million we sold the government projects was about 4% roughly, and this year we are targeting for about 8% to 10%. I think roughly we have done about 6% as far as government projects are concerned. Sure, that's useful. See, last year the team was only for North. Now we have penetrated to East, West and South, so give an additional 2% more. As we go along, we will focus on that and try to reach to a level of 8% to 10%. Sure, sir. The second question is, I understand we have launched a few brands in the retail network. I was just trying t

Hi, good afternoon to the management. This is Nitin Shakdher from the Green Capital Single Family Office. My question pertains to Kajaria International DMCC. While I understand that UAE has a robust real estate demand, any learnings as to what really went wrong in UK and how well the company's taking it a step further and getting aggressive in the UAE real estate markets? It's not an analyst question, but more from an investor point of view.

Rishi Kajaria

No, it's a good question. So Kajaria DMCC invested earlier in Dubai and then in UK. So we honestly got tempted by the good retail prices in the UK market, that is why we entered into a JV with a local partner there. And while during the operations we realized the costs are very high of running it. So looking at the management bandwidth and looking at the domestic growth in domestic future demand in India, we said it is better that we give that showroom to the local partner only, getting our equity back and let them run it. And we will continue to export. See, export will always be 1%, 1.5% of

Sir, thanks a lot for the opportunity. Firstly sir, what would be our revenue mix between Tier- 1, Tier-2 and Tier-3?

Ashok Kajaria

See, we have earlier said there is also Tier-4; Tier-1, Tier-2, Tier-3, Tier-4. Roughly Tier-1 is about 15% to 18%, Tier-2 is about 30%, Tier-3 is again about 30%, and the balance will be from Tier-4 roughly, plus/minus 2%, 3% here and there could be there. Okay. So sir, like in terms of the competitive intensity, majorly we would have seen the pressure in which part of this segment? See, pressure is everywhere. See, the problem is everywhere, but basically the dealer, in our trade, I would like to repeat that word, what is visible sells. In our trade the one who makes a beautiful showroom, an

Hi, thank you for this opportunity. Sir my question is on real estate cycle which a couple of participants and you have touched upon earlier. So, I believe there were a lot of launches around FY ‘22 and ‘23 which, as you just mentioned, should get reflected in an up cycle for tiles companies and other building material players in FY ‘26 and maybe FY ‘25. So that is largely on the Tier-1 side where you highlighted that 15%, 18% of your sales come from. Do you also believe that things are picking up in Tier-2 and to an extent in Tier-3 as well? And if yes, are there already some signals, etc., t

Chetan Kajaria

So for Tier-2 and Tier-3 we are strengthening our distribution network. We are trying to make our dealers more exclusive. So right now we have 1,850 dealers, out of that 440 dealers, about 430, 450 should be exclusive who sell only Kajaria. So our strategy going forward is more and more people to come in the fold of selling only exclusively Kajaria tiles. So with this, we will definitely see a surge in sales. Got it. But the demand, like Tier-1 we are expecting the demand to revive a lot at an industry level, right, because of all of these new launch completions that was started in FY ‘22 and

Yes. Hi. Thank you for the follow-up. Sanjeev ji, you just wanted to clarify one thing, you said the Rs. 14.5 crores of provision and about Rs. 7 crores of UK, that's Rs. 21.5 crores. This is included in the other expenses line item in the consol accounts. Is this correct?

Sanjeev Agarwal

No, no, no, they are not included. So Rs. 14.5 crores has been shown as a separate item, as an exceptional item. Okay. But when I look at consol accounts, there is no exceptional which is reported in the financials. I am looking at consolidated accounts. Just a second. Yes, sure. I will clarify to you offline. No problem, sir. And just one more clarification, on Bathware you said full year EBITDA was 4%. So when you say Bathware loss, it was EBITDA loss in 4Q only, is that what you referred to? This loss was basically because of the new plant. The new plant which commissioned late, that made l

Yes. Hi, sir. Just a couple of questions. One on the pricing front, how do you see this year panning out in terms of your overall pricing for broad adhesives and tiles specific?

Ashok Kajaria

So as we go along, we will see. And as the market improves, we keep on trying to increase prices and improve the realization. But it will be a strategic and a very strange affair as we go along. It's difficult to tell you any numbers right now. But as the market demand improves and wherever we can get a better realization, we will start increasing prices. Understood, sir. And sir lastly, what will be the CAPEX that you incur for the coming fiscal? That's it from my side. That will be around Rs. 150 crores to Rs. 200 crores for this year. The regular CAPEX? For this year it will be Rs. 250 cror

Yes. Hey, good evening, sir. Sir, my first question is on your CAPEX plan. So, like we have a pretty strong balance sheet with a good cash balance and our existing tile plant is operating at full capacity also, then why we have deferred our investment proposal of coming up with a large slab GVT tile plant in Morbi, can you please throw some lie?

Chetan Kajaria

So basically there is enough capacity in Morbi. And if we want to we can always outsource that in the future instead of putting our own Rs. 200 crores CAPEX and putting up a fresh plant out there. Sir, even for the large slab GVT tile plant you are of the view that there is an excess capacity in the market so we are not intending to come up with a new plant? See, we already have two lines of container plus, we are the only company which has a plant in North and South of India for container plus which makes big slabs. So we already have the capacity. And as right now the demand has been muted.

Yes. Hi, sir. Thank you for the opportunity. My question would on the broader scale, since we have seen this over supply in this industry for a while right now, what do you foresee in this, do we see this supply to be diverted back into the export markets? What is your opinion on the same?

Ashok Kajaria

I have already said that this year the export should cost Rs. 20,000 crores for two reasons. One, the stability in the world markets; and two, the freight rates are the lowest. The freight tier last year to the European markets was close to about $4,000, which has now come down to $1,600, making India again very, very competitive. So that Rs. 16,000 crores should go beyond Rs. 20,000 crores, as a result, part of the materials which were diverted to the domestic market will not be diverted here, and the pricing part should look better as we go along. Okay. And on the market share front, have we

Hello, I wanted to understand the industry scenario regarding if I look at the history all players will actually focus on one segment. For example, Hindware would be on Bathware, Somany would be on just tile. And then what happened is everybody started getting into everybody's domain. And that's the whole industry thing. So is this the reason for over supply? Could you help us understand the industry scenario?

Ashok Kajaria

Your question, you are not very clear what are you exactly asking, which division there is an oversupply, tiles or Bathware? Both I wanted to ask. Firstly, it is a related business, right. All the tile companies, the bigger tile companies that is Simpolo or a Johnson or a Somany or Kajaria, they all are into sanitary faucet because it's a related business. Like I will give you an example. We just opened two, three experience centers, big experience centers in South. Like in Chennai, we opened at 14,000 square feet experience center with tiles and sanitary ware and faucets. We are getting very,

Yes. Hi, sir. Sir, while I understand you mentioned in the near term you do not want to give guidance. But sir from a medium term perspective, do we believe we will go back to that double digit kind of volume growth with our historical margin increase of about 15%, 16%, do you believe that is something which we can, as investors, still look at?

Sanjeev Agarwal

See, this is another way of asking the guidance. We have already said we will not give guidance, so please do not ask. No sir, I am not asking for guidance for FY ’26. I am saying with the measures you are taking right now and whatever you are -- We are doing our best and we will be doing very hard work, but we will refrain from giving any guidance. Because when we give guidance, when we do not attain the guidance then you people say you have not attained the guidance. So it is better not to give the guidance and perform. Okay, sir. Thank you.

Hi sir. Thanks for the opportunity. Sir, can you detail something on the initiatives that we have taken on the technology side, including sales force automation? Is it already done on a pan-India basis? Are you already reaping the benefits or incrementally do we expect something out of it?

Chetan Kajaria

So Ritesh, we have started sales force automation and DMS also, which is dealer management system. Both have started now. Benefits will accrue in the coming months. We just launched it. People are getting used to it because they were not in their culture and system earlier. But definitely we see more efficiency generating out of it in the coming months as we go along. And has this been implemented on a pan-India basis or is it a certain pockets that we have implemented? On a pan-India basis, feeling of orders in the system of dealers and the sales force automation and everything. Okay, that's

Thank you for a follow up, sir. Just if you can give any clarification on your Rs. 250-odd crores of a CAPEX you are planning for ‘26, where is it only for maintenance or something else as well?

Ashok Kajaria

Majorly for maintenance and for our new office we will be making. It's not Rs. 250 crores, Rs. 250 was the last I said wrongly if I had said. Rs. 250 crores we did last year, this year the projection is around Rs. 200 crores plus. And out of that Rs. 100 crores will be, let's say, about Rs. 100 crores should be regular maintenance CAPEX and around Rs. 75 crores will be for the corporate office, and small around Rs. 25 crores will be for adhesive and Rs. 15 crores, Rs. 20 crores for maybe Nepal. Okay. That's really helpful. Thank you, sir. Thank you.

Thank you. On behalf of the entire Kajaria team, which is here, I thank you all for organizing this. It was very interesting; a lot of good questions have come. And I can assure you on behalf of the Kajaria management which is here that we will try to do the best possible this financial year, with all the corrections which we are talking about. Thanks a lot.

Chetan Kajaria

Thank you.

Speaking time

Ashok Kajaria

Moderator

Chetan Kajaria

Sanjeev Agarwal

Ritesh Shah

Rahul Agarwal

Sonali Salgaonkar

Sneha Talreja

Keshav Lahoti

Rishi Kajaria

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Opening remarks

Pranav Mehta

Thanks, Pooja. Good afternoon, everyone. On behalf of Equirus Securities, I welcome you to this post result conference call with the management of Kajaria Ceramics. From the promoter side, we have Mr. Ashok Kajaria – Chairman and Managing Director; Mr. Chetan Kajaria – Joint Managing Director; Mr. Rishi Kajaria – Joint Managing Director; and Mr. Kartik Kajaria. From the finance team we have Mr. Sanjeev Agarwal – CFO; and Mr. Parveen Gupta – DVP Finance. I will straight away hand over the call to Ashok sir for his opening remarks, post which we will open up the floor for question and answers. Over to you, Ashok sir.

Ashok Kajaria

Thank you, Pranav. Good evening, everyone. It gives me great pleasure to welcome you to the Q4 F’25 earnings conference call of Kajaria Ceramics Limited. Joining me on this conference call is the Senior Management Team of Kajaria Ceramics. Our consolidated revenue for the quarter stood at Rs. 1,227 crores, including Plywood, indicating a 1% year-to-year decrease compared to the corresponding period last year due to low tile volume growth and decline in Plywood sale. In Q4 F’25 we witnessed a very soft demand in the domestic as well as export market. We grew our tile volume by 2% in Q4 F’25. In the full Financial Year we have attained a 6% volume growth, reaching 115 million square meters. The EBITDA margin for Q4 25 stood at 10%. The reasons for the decline in margin are another muted quarter of the Bathware division, some loss in UK operations and provision of doubtful debts in the Plywood division, as we have decided to close this division. We had set up Plywood division in 2017, hop

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