Garware Hi-Tech Films , a leading manufacturer of specialty films, has provided forward-looking guidance on its growth prospects and profitability margins, contingent on potential changes in tariff structures.

Growth Projections

The company has set an ambitious target for its future expansion, projecting a Compound Annual Growth Rate (CAGR) of 15-20% for FY26 and beyond. This growth forecast demonstrates Garware Hi-Tech Films' confidence in its market position and product demand, despite facing potential headwinds.

Margin Outlook

Garware Hi-Tech Films expects to maintain EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization) margins within a range of 22-25%, with a potential variance of ±3%. However, the company acknowledges that this target may be challenging to achieve if the current 50% tariffs remain in place.

Tariff Impact

The company's guidance highlights the significant impact that tariff structures can have on its financial performance. The current high tariff rate of 50% appears to be a concern for Garware Hi-Tech Films, potentially affecting its ability to maintain desired profit margins.

TPU Plant Commissioning

Garware Hi-Tech Films anticipates an improvement in its EBITDA margins by 1.50-2.00% following the commissioning of its TPU (Thermoplastic Polyurethane) plant. This improvement is expected to materialize when the company's revenue reaches levels between INR 2,000.00-2,500.00 crores.

Revenue Milestone

The INR 2,000.00-2,500.00 crore revenue target provides insight into the scale at which Garware Hi-Tech Films expects to see enhanced profitability from its new TPU plant. This suggests that the company is positioning itself for significant growth in the coming years.

While Garware Hi-Tech Films faces challenges from high tariffs, its growth projections and planned improvements in manufacturing capabilities indicate a strategic approach to maintaining profitability and expanding market presence. The company's ability to navigate tariff pressures while pursuing growth will be crucial for its success in the specialty films market.

Garware Hi-Tech Films Limited , a leading manufacturer of specialty polyester films, has reported mixed financial results for the second quarter of fiscal year 2026 (Q2 FY26), showing resilience amid challenging market conditions.

Revenue and Profitability

The company's consolidated revenue from operations decreased by 8.2% year-over-year to ₹569.69 crore in Q2 FY26, compared to ₹620.58 crore in Q2 FY25. However, on a sequential basis, revenue grew by 15.1% from ₹494.99 crore in Q1 FY26.

Earnings before interest, taxes, depreciation, and amortization (EBITDA) for Q2 FY26 stood at ₹133.30 crore, down 11.4% from ₹150.50 crore in the same quarter last year. The EBITDA margin contracted by 85 basis points to 23.4% compared to 24.2% in Q2 FY25.

Profit before tax (PBT) declined by 12.8% year-over-year to ₹120.40 crore, while profit after tax (PAT) decreased by 12.5% to ₹91.20 crore in Q2 FY26. The PAT margin stood at 16.0%, down 80 basis points from 16.8% in the corresponding quarter of the previous year.

Half-Year Performance

For the first half of FY26 (H1 FY26), Garware Hi-Tech Films reported:

Operational Highlights

Despite the challenging business environment, Garware Hi-Tech Films maintained its focus on value-added products (VAP), which contributed 87% to the company's revenue. The company's strategic initiatives include:

1. Expanding its Paint Protection Films (PPF) network in Tier 1 and Tier 2 cities, with over 250 Garware Application Studios (GAS) across India.
2. Launching an e-portal for direct-to-consumer (D2C) PPF sales in the USA market.
3. Entering the D2C residential market with 'Garware Home Solutions' to capture high-growth consumer opportunities.
4. Achieving GreenPro certification from the Confederation of Indian Industry (CII) and Indian Green Building Council (IGBC) for its architectural films segment.

Financial Position

As of September 30, 2025, Garware Hi-Tech Films maintained a strong balance sheet with a liquidity surplus of ₹697.00 crore. The company's working capital days stood at 37, reflecting efficient management of its operational cycle.

Management Commentary

While specific management comments were not provided, the company's investor presentation highlighted its resilient performance despite the challenging business environment. Garware Hi-Tech Films continues to focus on sustainable margins for specialty films and improving its overall financial health.

Outlook

Garware Hi-Tech Films aims to drive growth through its value-added specialty films business. The company has outlined several focus areas for future growth, including:

1. Sun Control Films
2. Paint Protection Films (Architectural and Automotive)
3. Industrial Products Division
4. Garware Home Solutions
5. TPU Products

The company projects a revenue CAGR of 15-20% and maintains its focus on exports, which currently account for over 77% of its revenue.