Duroply Industries , a veteran in the plywood industry since 1957, has reported mixed results for the first quarter. The company saw a 10.3% year-over-year increase in revenue to Rs 93.5 crores, despite facing challenges in the premium segment and regional disruptions.

Financial Highlights

• Revenue grew 10.3% year-over-year to Rs 93.50 crores, but declined 15% sequentially
• Profit before tax improved significantly by 50% year-over-year to Rs 1.88 crores
• EBITDA grew 31% year-over-year to Rs 5.39 crores, with margins expanding to 5.8%
• Volume growth reached approximately 9% year-over-year

Segment Performance

Challenges and Strategies

Akhilesh Chitlangia, Managing Director & CEO, noted that the company faced demand challenges, particularly in the premium segment due to issues in North India, which is Duroply's strongest market. However, he expressed optimism about recovery based on July numbers.

The company is focusing on an asset-light model by expanding contract manufacturing and implementing digital initiatives to improve sales productivity. Duroply has recently adopted a new Salesforce application for better tracking and efficiency of its sales team.

Financial Metrics and Targets

• Gross margin stood at 34.1%, similar to Q1 last year
• Cash conversion cycle increased to 113 days
• The company is targeting EBITDA margins of 6.5-7% by FY27
• Return on Capital Employed (ROCE) aim is to hit 9-12% by the end of FY26

Corporate Updates

Duroply Industries has issued a Postal Ballot Notice dated July 31, 2025, seeking shareholder approval for the revision of remuneration structures for Mr. Sudeep Chitlangia, Executive Chairman, and Mr. Akhilesh Chitlangia, Managing Director & CEO. The proposed changes, if approved, will take effect from October 1, 2025.

Outlook

Despite the challenges, management remains confident about future growth. The company is working on establishing more capacities with contract manufacturers to meet increasing demand while maintaining an asset-light model. With current plant utilization at 70%, there's room for expansion up to 85% without additional investment.

Duroply Industries continues to focus on reducing working capital, optimizing its supply chain, and investing in its team and infrastructure. These strategic moves are expected to drive further improvements in operating margins and sustain growth in the coming quarters.

Duroply Industries Limited , a leading player in the plywood and allied products sector, has announced its financial results for the first quarter of fiscal year 2026, showcasing resilience in the face of market headwinds.

Financial Highlights

• Revenue reached Rs 93.54 crore, marking a 10.3% year-over-year increase, despite a 12.0% quarter-over-quarter decline.
• EBITDA rose to Rs 5.39 crore, up 34.6% year-over-year, with EBITDA margin improving to 5.76% from 4.72% in the previous year.
• Profit After Tax (PAT) decreased to Rs 1.55 crore from Rs 3.32 crore in the same quarter last year.

Operational Performance

Market Challenges and Outlook

Akhilesh Chitlangia, Managing Director & CEO of Duroply Industries, commented on the quarter's performance, stating, "This quarter saw liquidity challenges in the retail market and a significant slowdown, especially in North India during May, thus leading to muted growth."

Despite these challenges, Mr. Chitlangia expressed optimism about future prospects. "With the easing of monetary policy and our continued investment into infrastructure, marketing, and sales force, we expect our growth rate and profitability to increase in coming quarters," he added.

Strategic Investments

The company has made significant investments in infrastructure over the past year, which are beginning to yield results in terms of improved operating margins. These investments, coupled with a focus on marketing and sales force enhancement, are expected to drive growth and profitability in the coming quarters.

Industry Outlook

Duroply Industries is positioning itself to capitalize on several industry trends:

1. Expanding market potential driven by economic and infrastructure growth
2. Increasing demand for sustainable and eco-friendly plywood products
3. Growth in the furniture industry, fueled by modern designs and organized retail
4. Rising adoption of digital transformation in the furniture retail sector
5. Demographic advantages from a young, growing middle class driving long-term consumption

Conclusion

Despite facing market challenges, Duroply Industries has demonstrated resilience with its revenue growth and improved EBITDA margins. The company's strategic investments and focus on operational efficiency are expected to support its growth trajectory in the coming quarters. As the market environment improves and the company's initiatives take effect, Duroply Industries appears well-positioned to capitalize on the evolving trends in the plywood and furniture industry.

Investors and stakeholders will be watching closely to see how the company's strategies unfold in the face of ongoing market dynamics and economic conditions.