EPL Limited announced strong financial results for the third quarter of FY’26, with Revenue growing by 13.3% and EBITDA increasing by 12%, achieving a margin of 20.1%. The ROCE improved to 18.7%, expanding by 184 basis points year-on-year. Management highlighted that the strategy to accelerate Beauty & Cosmetics (B&C) growth is gaining traction, with the segment delivering 26% year-on-year growth. The company remains focused on margin discipline and capitalizing on B&C’s higher runway for growth.
EPL Limited Q3 FY’26 Performance Overview
EPL Limited hosted its Q3 FY’26 Earnings Conference Call on February 13, 2026, following the announcement of its Unaudited Standalone and Consolidated Financial Results for the quarter and nine months ended December 31, 2025. CEO Mr. Hemant Bakshi noted this was his first earnings call and expressed excitement over the operational strengths and opportunities ahead.
The quarter delivered strong, consistent performance:
- Revenue Growth: 13.3%, broad-based with double-digit growth in 3 out of 4 regions.
- EBITDA Growth: 12%.
- EBITDA Margin: Stood at 20.1%, 20 basis points lower than the previous year, but within the target operating range.
- ROCE: Improved to 18.7%, expanding by 184 basis points YoY.
Segmental and Geographic Highlights
The strategic pivot towards the Beauty & Cosmetics (B&C) segment is yielding results. This segment outperformed significantly, achieving 26% year-on-year growth. Non-oral products now account for 53% of the total portfolio. Regionally, EAP and Americas delivered particularly strong performance, growing 18% and 19% respectively, while AMESA grew 10%. India standalone saw a solid 8.7% growth, driven by B&C traction. Growth in Europe was lower than expected at 8%, impacted by operational issues and adverse mix.
Management expressed confidence in returning to targeted mid-teen margins in the coming quarters. Sustainable tube formats contributed 38% of sales during the quarter.
Future Strategy and Priorities
Looking ahead, EPL has outlined four priorities:
- Accelerating B&C Momentum: Continued investment in innovation and extruded solutions to sustain growth that has seen four consecutive quarters of over 20% growth in this segment.
- Scaling Emerging Markets: Consistent outperformance in Brazil and gaining traction in Thailand.
- Sustainability as a Growth Enabler: Leveraging its EcoVadis Platinum recognition and 38% sustainable format sales to deepen customer relationships.
- Margin Expansion and Capital Efficiency: Maintaining margin discipline, with confidence in achieving improved ROCE moving forward.
Q&A Insights on Operations and Margins
During the Q&A, CFO Mr. Deepak Goyal addressed margin protection, noting that 50% of business is on a pass-through basis for raw materials, and the company has strengthened its processes to ensure margins are not impacted by commodity price fluctuations. Regarding the recent China factory closure, management confirmed it was a customer-initiated move, and the equipment was relocated to another existing facility, incurring only a severance cost impact, with no capacity cuts.
On profitability, Mr. Bakshi clarified that while the selling price (ASP) in B&C is higher, per-unit margins as a percentage of revenue are similar between B&C and Oral Care; however, B&C delivers better overall P&L economics due to better fixed cost absorption.
Source: BSE
