Key Financial Figures

  • Operating Income: ₹15,412 lakhs for Q2 FY27, representing 10.8% year-on-year growth and 10.9% sequential growth
  • Operating EBITDA: ₹1,131 lakhs for the quarter
  • EBITDA Margin: 7.3% for Q2 FY27, compared to 11.3% in Q2 FY26 and 8.7% in Q1 FY27
  • PAT: ₹419 lakhs for the quarter
  • PAT Margin: 2.7%
  • Fixed Asset Turnover: 3.74 times
  • Cash Conversion Cycle: 70 days

Margin Analysis

The 393 basis points year-on-year EBITDA margin contraction was attributed to:

  • Approximately 190 basis points from higher raw material costs
  • Approximately 200 basis points from increased sales expenditures

Operational Highlights

  • Double-digit sales growth supported by focused sales promotion initiatives
  • Healthy growth in categories beyond writing instruments
  • Raw material cost pressures due to geopolitical uncertainties driving price increases across certain inputs
  • Company's raw material mix helped cushion overall cost impact
  • New product launches across Pentonic and linked portfolios
  • Expansion into lifestyle drinkware with Tri-Tonic brand of Tritan-based bottles
  • Stackoo experience centers operational in Kolkata and Mumbai

Joint Ventures and Subsidiaries

  • Uni-Linc JV (with Mitsubishi Pencil Company, Japan): Operationally stable with exports accounting for more than 50% of revenue during first half
  • Turkey JV: Operations progressing steadily
  • Morris Subsidiary (Korea): Development linked to commissioning of West Bengal manufacturing facility
  • Kenya Subsidiary: Sales momentum continues to improve
  • Linc On: Growing at healthy rate expected to gain further momentum

West Bengal Manufacturing Facility

  • Expected to become operational in Q3 FY27 (December 2026/January 2027)
  • Facility almost set up with final infrastructure being completed
  • Expected to support business traction and export volumes
  • Modern infrastructure with space for future capacity expansion
  • Will replace old facility with improved operational efficiency

Product Development

  • Uni-Linc JV launched one ball pen at ₹20 MRP, gaining good distribution and volumes
  • Two additional products in pipeline for launch in next 3-4 quarters
  • First new product expected in calendar year 2027

Management Guidance and Outlook

  • Priority is to sustain sales growth while improving balance between growth investments and profitability
  • Expect margin improvement as near-term input cost pressures moderate
  • Expect to return to previous margin levels over next 4-6 quarters
  • See improving trend from December 2026 based on recent announcements
  • Expect Q4 FY27 improvement if raw material prices remain stable
  • Better guidance on profitability for next financial year expected after next 2 quarters

Internal Margin Improvement Levers

  • Raw material mix developed over last 1-1.5 years showing lesser cost increases compared to normal grades (SAN, ABS, PP, PC)
  • Continued focus on premium price segment products with better margins than ₹10 price points

Participants in Earnings Call

  • Mr. Rohit Deepak Jalan, Whole-time Director
  • Mr. N.K. Dujari, Director Finance & CFO
  • Mr. Sanjeev Sancheti, Uirtus Advisors LLP (IR Advisor)
  • Mr. Navin B. Agrawal, Head Institutional Equities, SKP Securities (Moderator)

Transcript Availability

The transcript can be accessed at: https://linclimited.com/wp-content/uploads/2026/11/Transcripts-of-Earnings-callQ22627.pdf