Varmora Granito Limited has released the transcript of its first earnings call covering Q1, Q2, and H1 of FY27, held on October 23, 2026. The call details the company’s recovery in Q2 after a disrupted Q1, improvements in EBITDA margins driven by product mix and price hikes, and plans for capacity utilization. Management expressed confidence in sustainable margin growth and strategic focus on GVT products.
Varmora Granito Limited: Q1, Q2, H1 FY27 Earnings Call Transcript
Varmora Granito Limited has disclosed the transcript of its earnings conference call for the first, second, and first half of Fiscal Year 2027. The call, which took place on October 23, 2026, provided insights into the company’s financial performance and operational developments during the reviewed periods.
Financial Performance and Recovery
The company highlighted a recovery in the second quarter (Q2) following a disrupted first quarter (Q1). While Q1 saw challenges due to fuel unavailability, Q2 registered significant growth. Revenue growth in Q2 was reported at 3% year-on-year, with EBITDA margin improving by 17% and PAT seeing a substantial increase of 498% for the first half (H1) compared to the previous year. This profitability growth was attributed to a combination of a 21% increase in average realization, comprising a 3.5% improvement from product mix and the rest from price hikes, alongside operating efficiencies.
Product Mix and Margin Strategy
Bhavesh Varmora, Chairman and Managing Director, emphasized a strategic shift towards higher-margin products within their GVT (Glazed Vitrified Tiles) portfolio. The company noted that GVT contributes around 86% of its revenue, with a focus on higher-margin SKUs across 18 different sizes and 20 surfaces. While PVT (Polished Vitrified Tiles) and ceramic businesses are declining, the GVT segment is experiencing growth. The company sees significant scope for further margin improvement as the higher-value product mix gains traction.
Capacity Utilization and Capex
Current capacity stands at 50.6 million square meters, with utilization at 76% in the first half of the current year, up from 72% last year. Peak utilization capacity is estimated to reach 92% to 93%, with plans to achieve 80% to 85% utilization in the next fiscal year through growth. Currently, there are no immediate large capex plans, with maintenance capex expected to be small, around INR9 to INR10 crores.
Operational Highlights and Future Outlook
The company mentioned the commencement of its Northeast plant operations, expecting 75% utilization in the third quarter and 85%-87% in the fourth. The introduction of Integrated Stone Technology (IST) was highlighted as a key differentiator, offering a full-body replica of natural marble at a competitive price point. For the full year, Varmora Granito expects revenue growth of around 15% by value and 10% by volume, aiming to outperform the industry by 2-3%.
Export and Domestic Performance
Domestic revenue grew by 9%, with domestic GVT volume growth at 14%. Exports, however, experienced a de-growth of 17% to 18% due to container availability and freight costs, though freight rates have started declining, and normalization is expected from next month. The company maintains a focus on domestic sales, with exports comprising approximately 20% of its revenue historically, a split expected to continue.
Source: BSE
