FY26 EBITDA Margin Target: 13-14%
Management guided that FY26 should deliver 13-14% EBITDA margins (vs 12% in FY25), driven by premiumization in auto, new industrial segment entries, and ongoing reformulation efforts to mitigate TiO2 cost inflation.
KANSAINER / guidance tracker
Keep management guidance in view.
Kansai Nerolac Paints · forward-looking guidance across the available source record.
Research layer active
Guidance tracker
What management said would happen.
margins
Auto Segment Growth: Mid-single digits
Auto OEM coatings expected to grow at mid-single digits going forward, with new account wins and technology-led premiumization offsetting sluggish underlying demand.
Industrial Non-Auto: High single to low double-digit growth
Non-auto industrial segment (protective coatings, powder coatings, infrastructure) expected to grow at high single-digit to near double-digit rates, supported by infrastructure project wins and new segment entries requiring global approvals.
Q2 Expectation: Better than Q1
Q2 expected to be better than Q1 based on earlier Diwali (festive season in August-September vs October last year), normalization of monsoon impact, and improved project business activity. Tractor segment outlook positive on good monsoon.
FY27 EBITDA Margin: 13%+
Management targets maintaining 13%+ EBITDA margin in FY27, subject to geopolitical conditions not worsening. They cite internal sourcing efficiency, value engineering, and formula optimization as levers.
Medium-term Margin Target: 14%+
Management aims to reach 14%+ EBITDA margin in 2-3 years through premiumization, over-indexing on industrial segments, fixed cost leverage from capacity investments, and operational efficiency.
Capex: ₹150-200 Cr Annual, ₹601 Cr Special
Normal annual capex of ₹150-200 crore continues. The ₹601 crore announced capex for automotive powder coating and resin at Sayak Bay and Hosur will be spread over approximately two years.
Industrial Price Hike: Additional 3-5% in Q2
Industrial price increases of approximately 5% achieved so far, with additional 3-5% expected to flow through in Q2. Decorative should see additional 3% price realization in Q2.
EBITDA Margin Target: 13-14% Near-Term, 15% Long-Term
Management guided that EBITDA margins are expected to remain in 13-14% range in near-term with aspiration to reach 15% in long-term, supported by premiumization and cost optimization.
Automotive Growth: High Single-Digit in H2
Company expects high single-digit growth in automotive segment for second half, driven by GST reforms impact, festive demand, and positive forecast for Q3.
Decorative Recovery in Q4
Management expects Q4 to be significantly better than Q2/Q3 for decorative segment, with November-December uptick from wedding season and post-Diwali demand recovery.
Capex Plan: Rs 200+ Crore
Regular capex activity planned at around Rs 200+ crore for FY26, with network optimization planned for next year.
EBITDA margin maintained at 13-14%
Despite investments in distribution and manpower, management committed to maintaining EBITDA margins in the 13-14% range, prioritizing market share protection over margin expansion in near term.
Q4 decorative revenue growth target: mid-single digit
Management targets mid-single-digit growth for Q4 decorative segment based on observed recovery momentum in November-December and extended festive period versus Q3's shortened Diwali.
Industrial/automotive growth momentum to sustain
Automotive segment expected to maintain growth trajectory driven by GST 2.0 tailwinds and infrastructure spending on railways, roads, airports, and power sectors supporting high-end coatings demand.
Volume-value gap to remain flat in Q4
Management aims to maintain nil volume-value gap through continued focus on premium products and avoiding low-margin putty/construction chemical dumping, though mix variations may cause minor fluctuations.