Huhtamaki India Q2 Net Sales Up 23% YoY

Net Sales: INR 723 crores, representing 23.1% year-over-year growth
Sales Growth Drivers: Approximately 1/3 each from volume growth, pricing, and product mix improvement
EBITDA: Grew by 55% year-over-year with margins expanding from 8.3% to 10.5%
EBIT: Grew by 71% year-over-year with margins reaching 8.5%
Profit Before Tax: INR 559 crores, representing 77% year-over-year growth
Earnings Per Share: Significant growth of 77.3% year-over-year
Export and Domestic Growth: Both segments grew at similar rates

Net Sales: Approximately 12% year-over-year growth (double-digit)
EBITDA Margins: 10.5%, representing 2.2 percentage point improvement year-over-year
EBIT Impact: Included one-time prior period depreciation charge of INR 88 million (INR 8.8 crores) in Q1
Earnings Per Share: INR 9.18, representing 36% year-over-year growth

Operating Working Capital: Marginally increased during the period
Inventory Position: Consciously elevated to manage raw material volatility and prevent out-of-stock situations due to Middle East supply chain disruptions
Accounts Receivable: Increased reflecting higher volumes and pricing, but days sales outstanding (DSO) remained consistent with previous quarters
Inventory Valuation: Increased reflecting both higher volumes and cost increases from Middle East crisis

Q2 Components: Export benefit income of INR 28.5 million and increased scrap sales
H1 Components: Export benefit income increased by INR 47.8 million year-over-year and scrap sales increased by INR 35.5 million
Scrap Sales Increase: Attributed to higher production volumes and better realizations due to inflationary conditions

Markets operated in remained robust and competitive with 4-5% growth range
Significant Middle East crisis impact on supply chain and raw material costs
Some customer inventory buildup due to anticipation of further price escalations

Company has adequate capacity for future growth
Productivity improvements have created additional capacity without new investments
Working efficiently with current capacity to cater to growth

People & Safety:

Climate:

Solar captive generation power plant coming online in Q3 CY 2026
Plant will supply 50% of power for Khopoli facility
Decarbonization roadmap for 2030 Scope 1 and Scope 2 commitments progressing well

Nature:

Commitment to Zero Liquid Discharge across plants
Taloja plant implemented mechanical vapor recompression system for water recycling
Rainwater harvesting and groundwater recharge programs

Product Innovation:

Focus on profitable growth, selective market participation, and disciplined capital allocation
Strategy of customer intimacy, share of wallet growth, and innovation delivery
Not sacrificing profitable growth principle for volume
Right product and customer mix now stabilized

Raw material cost changes mostly occurred in Q2
Transparent inventory sharing with customers
Variation in pass-through mechanisms: quarterly index changes for some customers, frequent changes for others
Commitment to nimble adjustment of pricing to avoid bearing cost impacts

Cash deployed in market instruments generating returns at or above benchmark indices
Focus on organic growth through equipment modernization and productivity capex
Prioritizing return on investment for shareholders
No specific inorganic growth plans disclosed
Continuous evaluation of strategic opportunities

Balanced growth between domestic and export markets
Export competitiveness depends on product differentiation and regulatory factors (import tariffs)
Cross-selling opportunities with global parent company entities
Capacity sharing arrangements with international counterparts