Kajaria Ceramics Ltd Q2FY26 – When Tiles Meet Bollywood: A Story of Margins, Morbi, and Midlife Brand Reinvention
1. At a Glance
Kajaria Ceramics Ltd — India’s ceramic emperor and global eighth-largest tile tamer — just served up a quarter that looked like Akshay Kumar’s abs: consistent, firm, but not exactly new. The Q2FY26 consolidated revenue stood at ₹1,186 crore, up barely 0.6% YoY, yet PAT jumped 58% YoY to ₹134 crore as operating margins touched a glossy 17.9% (finally catching some shine after quarters of grout-level pressure).
At a market cap of ₹19,439 crore and trading at ₹1,220, the stock commands a P/E of 48.5x — not cheap, not crazy either, just “Kajaria expensive.” ROCE is a respectable 17.1%, ROE 11.2%, and the company continues its tradition of making even tiles sound like luxury brands.
They declared an interim dividend of ₹8 per share (record date Oct 24, 2025), the leadership trio — Ashok, Chetan, and Rishi Kajaria — got re-elected for another five years, and commercial production started at their new tile adhesive facility in Rajasthan.
So yes, Kajaria’s still India’s tile king — but now it’s learning to mix grout with glamour.
2. Introduction – The Ceramic Superstar of Bharat Inc.
Kajaria doesn’t just make tiles; it tiles India’s dreams. From airport washrooms to your chacha’s modular kitchen, chances are you’ve walked over Kajaria’s margins at least once. Founded in 1985 and headquartered in Delhi, the company has morphed from a dusty ceramic maker into a ₹4,600+ crore design conglomerate with six mega factories, 1,800 dealers, and an obsession for prime-time TV ads.
In a sector where competition is as crowded as Morbi’s skyline, Kajaria has done the unthinkable — maintained double-digit margins and double celebrity endorsements. (Ranveer Singh breaks the bathroom tiles in the ad; Anushka Sharma smiles and forgives him.)
But while branding glitters, the numbers show a plateau. Five-year sales CAGR at 10.5%, profit CAGR at 3.3%, and one-year return at -10% suggest the company’s growth engine is idling between premiumisation and price fatigue.
Still, when you’re the market leader in an essential product that literally covers half of India’s surfaces, a little slowdown is just… surface-level.
3. Business Model – WTF Do They Even Do?
Kajaria’s business model is as smooth as its polished vitrified tiles: make, market, and move millions of square meters of ceramic glory. The company operates in four main verticals:
Tiles (≈88% of revenue):
Ceramic wall and floor tiles, glazed vitrified tiles (GVT), and polished vitrified tiles.
Brands: Kajaria, Kajaria Eternity, and Kajaria Ultima.
Sanitaryware & Faucets (~8%):
Operated under Kerovit brand. Kajaria Bathware Pvt Ltd (KBPL) has become a growth engine in the premium bathroom segment.
Plywood & Laminates (~2%, discontinued FY25):
Kajaria Plywood Pvt Ltd (KajariaPLY) was shut down in FY25 due to losses — ₹112.38 crore fully impaired.
Adhesives & Ancillary Products (~2%):
Through Kajaria Adhesives Pvt Ltd (KAPL) – now scaling up via a new Rajasthan plant with 36,000 tonnes/year capacity.
In short, Kajaria doesn’t just make tiles — it manufactures status.
Commentary: Margins have returned to pre-pandemic sparkle, thanks to softening gas prices and operating efficiency. But revenue growth remains the missing tile in this mosaic.
5. Valuation Discussion – Fair Value Range (Educational Only)
(a) P/E Method: EPS (TTM): ₹22.7 Industry Average: 44x → Fair Value = ₹1,000 – ₹1,350
(b) EV/EBITDA Method: EBITDA FY25 = ₹636 Cr EV/EBITDA range (20x–25x) → Fair Value = ₹12,700 – ₹15,900 Cr Market Cap equivalent → Per-share range = ₹1,150 – ₹1,440
Disclaimer: This range is for educational purposes only and not investment advice.
6. What’s Cooking – News, Triggers, Drama
Leadership Shuffle (Sep 2025): The Kajaria dynasty continues — Ashok is now Chairman, Chetan Vice Chairman, Rishi MD. Boardroom musical chairs, but all within the same family drawing room.
New Adhesive Plant: Commercial production began at Bhiwadi-Alwar (Rajasthan), capacity 36,000 tonnes/year. Expect this sticky business to add incremental ₹60–₹70 crore revenue annually.
Interim Dividend: ₹8 per share announced on Oct 16, 2025. Kajaria never forgets its shareholders, even when profits wobble.
Plywood Business Burial: KajariaPLY officially shut
