Somany Ceramics September 2026 Investor Meet Update

The company scheduled two group meetings in Mumbai on Friday, September 11, 2026:

1:30 PM: Meeting with Sell Side Analysts (Physical – Mumbai)
3:30 PM: Meeting with Institutional Investors/Fund Managers (Physical – Mumbai)

The investor update presentation is also available on the company's website at www.somanyceramics.com.

Domestic demand for ceramics remains robust, supported by healthy residential real estate demand, renovations, premium housing, and infrastructure spending.
A premiumization trend continues, with consumers increasingly preferring higher-value tiles, large formats, and premium finishes.
The Morbi ceramic industry faced significant disruption due to shortages and elevated prices of propane and natural gas, impacting production across the cluster.
Gas prices surged sharply, rising from approximately ₹45/scm to as high as approximately ₹90/scm, with uncertainty regarding pricing continuing. No significant price reduction is expected in the short term.
Industry exports fell to approximately ₹2,900 crore in Q1 FY27 versus approximately ₹4,800 crore in Q1 FY26 (representing a 39% year-over-year decline). Export volumes stood at approximately 69 million square meters (msm), declining by 51% year-over-year.
Industry players implemented price hikes to offset higher fuel and logistics costs, demonstrating improved pricing discipline.
Organized players with units spread across multiple geographies are gaining relative advantage, benefiting from stronger brands, wider distribution networks, and manufacturing flexibility during industry disruption.

Added approximately 200 dealers in FY26, taking the network to approximately 3,100 active dealers with 550 exclusive showrooms.

Channel restocking is now getting normalized after dealers accumulated stock in March before price increases, which was sold in April and May. Currently, channels are cautious due to gas price uncertainty but have started building adequate stocks.

The company is experiencing higher utilization of owned manufacturing assets, leading to improved manufacturing economics and higher contribution from own production.
Optimum plant capacity is approximately 95%. The company is adding approximately 20% capacity in FY27E and FY28E.
An additional 9.9 MW of solar capacity is operational at the Kassar Plant.

Operational efficiency and product mix changes are converting JVs into potential earnings contributors.
Potential PBT swing of approximately ₹35-40 crore from JV turnaround.
Specific JV initiatives include:
Vintage Upgradation: ₹16 crore capex investment to upgrade manufacturing capacity for premium products.
Max Optimization: New press installation driving productivity, efficiency and manufacturing flexibility.
Sudha Modernization: ₹25 crore investment in a state-of-the-art Continua press for Large Format Tiles.
Operating Leverage: Higher capacity utilization leading to improved manufacturing economics at all JV plants.
Green Energy Initiatives: Captive solar installations at Sudha, Vintage and Max plants are expected to drive energy savings and improve operational efficiency, taking total renewable capacity to 26 MWp across all locations.

Debottlenecking: Approximately 5 MSM of incremental GVT capacity through debottlenecking and modernization, requiring minimal capex. This includes 2.5 MSM through ceramics capacity conversion and 2.5 MSM through augmentation. This has the potential to generate approximately ₹200+ crore of additional revenue while enhancing operating leverage.
South India Expansion: 9+ MSM GVT manufacturing capacity with capex of ₹220 crore. The project is expected to commission in 12-15 months, located adjacent to the existing south plant with land already purchased. Funding will be through a mix of debt and equity. This represents a potential revenue opportunity of approximately ₹350+ crore.

Operating leverage is expected to drive earnings growth through high utilization, improving JV profitability, and low-capex capacity enhancements.
Multiple operating levers are contributing to sustainable expansion in EBITDA Margins from 9.3% to approximately 11.3% in FY27 and a further 100 basis points in FY28.

MUFG Intime India Private Limited (A part of MUFG Corporate Markets, a division of MUFG Pension & Market Services)