Transcript of Earnings Call

5th November, 2026 The Secretary The Secretary BSE Ltd. National Stock Exchange of India Ltd. Corporate Relationship Dept., Exchange Plaza, Plot no. C/1, G Block, 14th floor, P. J. Tower, Bandra-Kurla Complex, Dalal Street, Fort Bandra (E), Mumbai - 400 001 Mumbai - 400 051 Stock Code – 500331 Stock Code - PIDILITIND Sub: Transcript of the Earnings Call --------------------------------------------------- Dear Sir, We enclose herewith, a transcript of the Earnings Call held with Analyst/Investors on 29th October, 2026. A recording of the transcript is available on the website of the Company viz. www.pidilite.com. Kindly take the same on records. Thanking You, Yours faithfully, For Pidilite Industries Limited Manisha Shetty Company Secretary Encl: as above Regd. Office Pidilite Industries Limited Regent Chambers, 7th Floor Corporate Office Jamnalal Bajaj Marg Ramkrishna Mandir Road 208 Nariman Point Andheri - E, Mumbai 400059, India Mumbai 400 021 T + 91 22 2835 7000 2835 7952 / 2835 7365 F +91 22 2830 4482 www.pidilite.com ClN:L24100MH1969PLC014336 Pidilite Industries Limited Q2 FY27 Earnings Conference Call October 29, 2026 MANAGEMENT: MR. SUDHANSHU VATS – MANAGING DIRECTOR MR. KAVINDER SINGH, JOINT MANAGING DIRECTOR – MR. SANDEEP BATRA – EXECUTIVE DIRECTOR AND CHIEF FINANCIAL OFFICER MR. AMIT AGARWAL – CHIEF FINANCIAL OFFICER DESIGNATE MR. BHAVESH JOSHI – SENIOR VICE PRESIDENT, DOMESTIC ACCOUNTS AND TAXATION MODERATOR: MR. ARUN BAID – ICICI SECURITIES Page 1 of 19 Pidilite Industries Limited October 29, 2026 Moderator: Ladies and gentlemen, good day, and welcome to the Pidilite Industries Limited Q2 FY27 Earnings Conference Call, hosted by ICICI Securities. As a reminder, all participant lines will be in the listen-only mode and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during the conference call, please signal an operator by pressing star, then zero on your touch-tone phone. I now hand the conference over to Mr. Arun Baid from ICICI Securities. Thank you, and over to you, Mr. Arun. Arun Baid: Good afternoon, ladies and gentlemen. On behalf of ICICI Securities, I welcome you all to the Q2 FY27 Post Results Con-Call of Pidilite Industries. From the management side, we have Mr. Sudhanshu Vats, MD; Mr. Kavinder Singh, Joint MD; Mr. Sandeep Batra, ED and CFO; Mr. Amit Agarwal, CFO Designate; and Mr. Bhavesh Joshi, Senior Vice President, Domestic Accounts and Taxation. Now, I hand over the call to Mr. Batra for his opening remarks. Over to you, sir. Sandeep Batra: Thank you, Arun, and good afternoon, everybody, and apologies for this slight glitch. But anyway, we have now joined, and I will quickly give a brief update on the second quarter and H1 results, which were approved at our Board meeting yesterday. In the current quarter, our stand-alone revenue was under INR4,000 crores with a growth of 21.7% in nominal terms and underpinned by underlying volume growth of 10.7%, which was broad-based. Consumer and Bazaar growth in the quarter was quite broad-based with Consumer and Bazaar UVG was 11.1% and B2B UVG was 9.2%. However, in the quarter, we saw the maximum hit and impact on account of elevated input costs, and gross margins stand-alone declined sequentially as well as year-on- year as an indicator of the kind of extent of the input cost inflation. We always refer to what has been the VAM consumption rate, which in the second quarter was $1,630, nearly double of what it was in the same period last year and versus $1,370 in the first quarter. So the second quarter saw the full impact of elevated input costs. However, because of the robust top line growth, we got operating leverage, and against the 720 basis points decline in gross margin, our EBITDA was lower by 430 basis points and came in at the lower end of our range, at 20.4%. Our subsidiary performance was good for the quarter with international subsidiaries growing by 21.8%. Page 2 of 19 Pidilite Industries Limited October 29, 2026 Good growth in our businesses in Dubai, Bangladesh, Kenya, Thailand. All 4 of them grew in excess of 20%. EBITDA in the international subsidiaries also improved with a growth of 53% versus the top line growth of 21.8%. Domestic subsidiaries too delivered a strong quarter with a revenue growth of 22.2%, again, led by the Consumer and Bazaar businesses, which grew by 22% and B2B businesses grew by also 22%. The only business that saw some revenue headwinds was Nina, which had challenges because they did not have adequate workfront available for doing waterproofing. But I think as we had called out in the first quarter itself, where we saw the benefit of lower input costs and the benefit of pricing that we had taken; that it is better to look at the H1 as a representation of the company performance. And therefore, in H1, if I were to look at our stand-alone revenues grew by 22%, UVG was 11%. Again, broad-based Consumer and Bazaar UVG for H1 was 11.6%, and B2B UVG was 8.3%, and our H1 EBITDA again came in strong, very much towards the upper end of the range at 23.5%. So that's all I had in terms of the overview of the quarter and the first half. Open the floor for questions. Moderator: Thank you very much. We will now begin the question-and-answer session. The first question is from the line of Abneesh Roy from Nuvama. Abneesh Roy: The first question is on the margins. You have done quite well on the demand side, volume growth trends are strong. So, congrats for that. My question is on the margins. So you have said that in H2, there is a recovery in the margin. So I wanted to understand the pricing was delayed because you were expecting the geopolitical issue to get resolved? And if you could elaborate what is the current pricing of VAM and the crude-related inputs? That is the first question. Sudhanshu Vats: Yes, Abneesh, always a pleasure to hear from you and to get you as a first question. I know while Sandeep has spoken about our performance, I just wanted to take a minute to talk about this in the context of the question you asked and then maybe address the question again. See, what is happening, in fact, we are in an environment, which has got very high raw material inflation. And I think we talk about VAM as representative, but I think there is raw material inflation in many other raw materials of Pidilite. Some of them have reasonable crude linkage as well, by the way. So, therefore, and you have seen crude is elevated at about $115. So very high raw material inflation, coupled with quite a lot of volatility and uncertainty. And these 2 words are important. I use these words most of the time, but I want to give a little bit of definition in our context. So first, uncertainty is very simple. Page 3 of 19 Pidilite Industries Limited October 29, 2026 I am saying that is what is happening around the world. You see the entire West Asia conflict, and therefore, movement of goods and so on and so forth. But forget cost of sea cargo, but even movement, and therefore, that is a challenge and continues to remain a challenge. And therefore, you got to manage that well. Volatility is another point I wanted to touch base on. So as Sandeep was telling you, see, basically, if you look at FY26, we had VAM at about $800 to $900 through the year, I am saying a little bit here and there, $800 to $900. As soon as West Asia conflict happened, VAM actually shot up to almost $2,000, if I am not mistaken, just $2,000 really shot up. And we had a point of view on where VAM will go based on our earlier understanding of many years. And therefore, $2,000 was not sustainable. We thought it will settle at a number based on which we priced in quarter 1. And I am giving you an illustrative example of Fevicol and VAM, but it's true for our entire portfolio. So, we priced that. We were actually proactive in pricing. We basically price on what we call replacement margin, which is what is the replacement cost there and then [Showing first 8,000 characters — download PDF for full document]