1. At a Glance

If you’ve ever wondered what happens when India’s biggest PVC pipe manufacturer starts slipping on margins while wrestling with family drama and tax penalties — welcome to Finolex Industries Ltd (FIL) Q2 FY26, a quarter that was both “plastic” and “fantastic”.

At ₹185 per share, this ₹11,495 crore market cap company looks like the sober uncle at a small-cap wedding — respected, debt-free, but slightly tipsy on “other income”. Sales this quarter stood at ₹859 crore, up a mild 3.7% YoY, but PAT rocketed 132% YoY to ₹119 crore — thanks less to operations and more to the “interest-free divine blessing” of ₹60 crore in other income.

Finolex’s OPM stood at a modest 15%, while ROE and ROCE are at 6.76% and 8.77% respectively — barely enough to excite a savings account. Still, with a zero-debt balance sheet, 33.9% dividend payout, and a promoter family that could write a Netflix soap opera, FIL remains the PVC king with a shiny, slippery throne.

The question is — can Finolex turn its PVC pipes from “Plastics with Problems” to “Profits with Purpose”? Let’s get our hands dirty (and maybe slightly sticky) digging in.

2. Introduction

There are companies that make news, and there are companies that quietly make pipes. Finolex Industries belongs to the latter — until someone resigns, a tax notice arrives, or PVC prices crash harder than crypto in 2022.

Established as a reliable player in India’s infrastructure and agri story, FIL has pipes stretching across farmlands, bathrooms, and industrial zones. Yet, the past few quarters have seen more drama in Ratnagiri than in a Marathi soap — managing directors resigning, auditors changing, and a family feud that refuses to fade like an old watermark on a pipe.

The numbers though? Stable. Sort of. FY25 revenue was ₹4,075 crore, PAT ₹437 crore, with an 11.7% operating margin. Not terrible — but far from its pandemic-era highs when PVC prices made every pipe company look like a hedge fund.

In H1 FY26, revenue hit ₹2,026 crore with ₹216 crore profit, showing that while growth isn’t breathtaking, the company is at least holding its breath underwater better than competitors with debt.

So yes — Finolex is still that rich, old industrialist: not broke, not booming, just rich enough to keep hosting family board meetings that end in polite chaos.

3. Business Model – WTF Do They Even Do?

Let’s make it simple. Finolex Industries does two things: makes PVC resin (the raw material) and turns that into pipes and fittings (the finished goods). In short, it manufactures both the ingredient and the recipe.

1) PVC Pipes & Fittings (99% of revenue H1 FY25)From agriculture to sanitation, Finolex sells 2,000 SKUs under multiple categories: ASTM, SWR, CPVC, and sewerage pipes. You name the flow, they’ve got a pipe for it. Volumes shot up 42% between FY22 and FY24, but a 23% fall in price realizations kept the top line flat — classic case of “we sold more to earn less.”

2) PVC Resin (1% of revenue H1 FY25)Here’s where Finolex flexes its muscle: backward integration. It’s India’s only large player making its own PVC resin. Unfortunately, global resin prices fell 75%, sales volume tanked 75%, and revenue crashed 83%. The intercompany transfers cushioned some of that, but the resin arm’s glory days are behind it — for now.

Finolex’s biggest asset isn’t a factory or a pipe; it’s its distribution network — 900 dealers and 30,000 retailers — making it the Amazon of agriculture, without the free delivery.

4. Financials Overview

Finolex’s revenue growth is modest, but profits ballooned because last year’s base was embarrassingly low. EBITDA margin rebounded