The company reported a net profit of ₹114.5 crore for the quarter ended June 30, 2026, compared with ₹98.2 crore in the corresponding period last year.
Revenue from operations, however, declined 15.3% year-on-year to ₹883.6 crore from ₹1,043.2 crore, reflecting lower sales during the quarter.
Despite the decline in revenue, operating performance improved. EBITDA increased 13.9% to ₹106.6 crore from ₹93.6 crore, while EBITDA margin expanded to 12.1% from 9% a year earlier.
Lower demand hits volumes
The company attributed the decline in revenue primarily to lower sales volumes.
PVC pipe volumes fell 27% year-on-year to 67,699 metric tonnes, compared with 92,129 metric tonnes in the corresponding quarter last year.
According to the company, demand remained weak during the quarter as volatility in PVC prices prompted customers to defer purchases, weighing on overall sales.
In simple terms, buyers held back purchases as PVC prices fluctuated, leading to fewer pipes being sold despite continued demand from end-use sectors.
Higher margins cushion the impact
Although Finolex sold fewer pipes and reported lower revenue, it generated higher profit during the quarter as operating profitability improved.
The expansion in EBITDA margin suggests the company retained a larger share of every rupee of revenue as operating profit compared with the same period last year.
Why this matters: For manufacturing companies, stronger margins can often offset slower sales growth by improving profitability. It also indicates better cost management, improved product mix or favourable input costs, helping protect earnings even in a weaker demand environment.
Strong balance sheet provides flexibility
Finolex Industries also highlighted its healthy financial position, reporting net free cash of around ₹2,636 crore at the end of the June quarter.
A strong cash position provides the company with greater financial flexibility to fund capacity expansion, invest in new products, pursue acquisitions or navigate periods of weaker demand without relying heavily on borrowings.
What to watch
The June-quarter results underscore the challenges facing the PVC pipes industry, where volatile raw material prices and softer demand affected volumes.
Going forward, investors are likely to watch whether demand improves during the remainder of FY27 and whether PVC price stability encourages distributors and customers to resume purchases. The company’s ability to sustain its stronger margins while volumes recover will also remain a key monitorable.
Shares of Finolex Industries Ltd. ended 2.3% higher at ₹171 on the National Stock Exchange (NSE) on Thursday, ahead of the earnings announcement.
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