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Steelware supply constraints and margin pressure
View Risks →Cello World Limited — Q2 FY26
Cello World delivered a strong Q2 FY26 with revenue of ₹587.4 crore, up 20% YoY, driven by festive demand and consumerware growth of 23%.
bullish
high
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Cello World delivered a strong Q2 FY26 with revenue of ₹587.4 crore, up 20% YoY, driven by festive demand and consumerware growth of 23%. EBITDA margin came in at 24%, while PAT stood at ₹85.7 crore. The glassware plant achieved breakeven at 60% utilization, though steelware faced supply constraints and margin pressure. Management guided for double-digit revenue growth and EBITDA margins of 22-23% for FY26. The acquisition of the Cello brand for writing instruments from BIC is expected to close within the month, with revenue contribution starting in Q4. Key risks include sustained margin pressure from steelware and glassware ramp-up, and potential demand slowdown post-festive season.
सेलो वर्ल्ड ने दूसरी तिमाही में अच्छा प्रदर्शन किया। कंपनी की कमाई ₹587.4 करोड़ रही, जो पिछले साल से 20% ज्यादा है। त्योहारों की मांग और घरेलू सामान की बिक्री 23% बढ़ने से यह हुआ। कंपनी का मुनाफा (EBITDA) 24% रहा, और शुद्ध मुनाफा (PAT) ₹85.7 करोड़ था। कांच के बर्तनों का कारखाना 60% क्षमता पर चलने पर घाटा खत्म कर लाभ पर आ गया, लेकिन स्टील के बर्तनों में आपूर्ति की कमी और मुनाफा कम होने की चुनौती रही। प्रबंधन का अनुमान है कि पूरे साल कमाई दो अंकों में बढ़ेगी और मुनाफा 22-23% रहेगा। सेलो ने बीआईसी से लेखन सामग्री का ब्रांड खरीदा है, जो इसी महीने पूरा होगा और चौथी तिमाही से कमाई देगा। जोखिमों में स्टील के बर्तनों पर दबाव और त्योहारों के बाद मांग कम होना शामिल है।
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Read Transcript →Quarter Snapshot
Consumerware segment growth
23%
+23% YoY
Consumerware segment grew 23% YoY, supported by festive demand and strong uptake across key product lines.
Glassware plant utilization
60%
+5pp QoQ
Glassware plant utilization improved to 60% in Q2 from 55% in H1, achieving breakeven during the quarter.
Writing instruments revenue
₹81 crore
+16% YoY
Writing instruments segment grew 16% YoY to ₹81 crore, driven by new product launches and revival signs.
Online sales contribution
11.6%
+? pp YoY
Online sales contributed 11.6% of revenue, reflecting a shift in channel mix and improving working capital.
What Changed vs Last Quarter
NEW
Double-digit revenue growth for FY26
Management expects to achieve 12-15% revenue growth for the full year, with H1 growth at 13%.
NEW
Steel plant to commence production in December 2025
The steel plant will start production in December 2025, stabilizing in 4-5 months, improving supply chain and margins.
NEW
Cello brand acquisition to close within the month
The acquisition of the Cello brand for writing instruments is expected to close within the month, with revenue contribution from Q4 FY26.
UPDATED
EBITDA margin guidance of 22-23% for FY26
EBITDA margin (excluding other income) is guided at 22-23% for FY26, with H1 at 22%.
DROPPED
Full-year revenue growth of 12-15%
Management expects overall revenue growth of 12-15% for FY26, driven by consumerware and glassware ramp-up.
DROPPED
Glassware plant to break even by end of FY26
The glassware plant is expected to break even by the end of the fiscal year as efficiencies improve to 85%.
DROPPED
Steel flask capex of ₹40-50 Cr in FY26
Capex for the new steel flask facility is ₹40-50 Cr, with total capex around ₹100 Cr for the year.
NEW RISK
Steelware supply constraints and margin pressure
Steel category declined due to supply shortages and higher OEM costs, impacting margins. Recovery depends on new plant ramp-up.
NEW RISK
Demand sustainability post-festive season
Q2 growth was partly driven by early festive demand; sustainability of demand in Q3 and Q4 remains uncertain.
NEW RISK
Integration and revenue visibility of Cello brand acquisition
Management declined to provide specific revenue or margin targets for the acquired Cello brand, citing premature stage.
RISK GONE
Margin pressure from inability to raise prices
Management admitted they could not raise prices in April due to aggressive competition, leading to margin compression.
RISK GONE
Writing instruments segment may not recover
Despite new product launches, writing instruments revenue declined 11% YoY and management expressed uncertainty about recovery.
RISK GONE
Competitive intensity in consumerware categories
Management noted that margins have peaked in some categories due to new entrants and aggressive pricing.
Fast read
Guidance and risk preview
Management expects to achieve 12-15% revenue growth for the full year, with H1 growth at 13%.
Steel category declined due to supply shortages and higher OEM costs, impacting margins.
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