Pidilite Q1 earnings: Pidilite Industries earnings Q1FY2022

Net Profit soars: Pidilite Industries has reported 1273% rise in Profit After tax to Rs 218 crore, mainly aided by lower base in the previous year. Pidilite Industries saw a demand recovery since mid-June 2021, most markets returning to normalcy across town classes and geographies. While Consumer & Bazaar businesses (C&B) has witnessed recovery led by adhesive, construction chemicals and DIY portfolio, recovery in Business to Business (B2B) is on account of resurgence in industrial activity.

Revenues rise: Net sales at Rs 1,928 crore grew by 121% over the same quarter last year. On a like to like basis (excluding PAPL) Net Sales grew by 113%.   Among segments, Consumer & Bazaar business grew 111.70% to Rs 1,486.24 crore in Q1 FY22 from Rs 702.02 crore in Q1 FY21. Business to Business revenues climbed 156.08% to Rs 482.02 crore in Q1 FY22, up from Rs 188.23 crore in last year.

Margins expand: While Pidilite’s operating margins expanded 1030 bps to 17.9% (from 7.6% last year), they were slightly below estimates. Gross margins were impacted due to sharp escalation of input costs, partially offset by Pidilite’s pricing. While domestic subsidiaries also suffered as a consequence of the lockdown in May 2021, the company saw a sustained recovery in demand from mid-June 2021 onwards. Overseas subsidiaries continued its positive momentum and reported high double-digit constant currency revenue growth as well as strong earnings growth, the company said.

Pidilite Industries: Earnings review

Pidilite Industries has reported a strong set of numbers for Apr-Jun 21 period, aided by demand recovery in the quarter. Despite a challenging business environment, the company was able to deliver broad-based sales as well as earnings growth across businesses and geographies. While this was mainly aided by a lower base last year, the recovery is an encouraging sign. 

Input costs remained a significant challenge. Going forward, the company said that the input costs would gradually soften over the second half of the year. This should help the company to improve margins and return ratios in the upcoming quarters.