It’s been raining IPOs and monsoons, but in the tile world—Morbi’s tax-evading factories still run on their own climate control. Somany’s Q1 FY26 was a cocktail of muted domestic demand, shrinking exports, and a kiln shutdown that hurt sanitaryware. Yet management is betting big on construction chemicals with Durabuild, because when life gives you damp walls, sell waterproofing.
Here’s the kicker: Sales crept up just 4% YoY (₹601 crore), margins stayed fragile at 77% utilization, and one premium “Max” plant bled ₹6.5 crore. But CEO Abhishek Somany swore H2 will be “100 times better”—a line fit for motivational posters in factory break rooms.
Why it matters? Because tiles are officially as commoditized as onions in a mandi. And Somany’s survival depends on moving up the value chain before Morbi’s GST gymnastics bury the industry.
Stick around—things get spicier two scrolls down.
AT A GLANCE
• Revenue up 4% YoY – CFO insists it’s “growth,” not rounding error• Capacity utilization 77% – three plants holidaying on company time• Max plant loss ₹6.5 crore – turns out “premium” doesn’t mean “profitable”• Gross margin flat YoY – inflation-proof like your dad’s scooter• Sanitaryware kiln fixed – management promises Q2 flushes smoother• Durabuild JV signed – Somany wants a slice of Pidilite’s waterproof pie
MANAGEMENT’S KEY COMMENTARY
- “Muted demand and lower exports hit us this quarter.”→ Translation: Even Morbi’s GST wizards couldn’t conjure demand.
- “Nepal sales can’t be consolidated due to local laws.”→ Translation: We sold there, but accounting rules made it invisible—Schrödinger’s revenue.
- “Capacity utilization dropped to 77%.”→ Translation: Plants ran like government offices in May.
- “Sanitaryware kiln shutdown hurt Q1, but it’s back at 100%.”→ Translation: Toilets are finally in production; bathrooms across India can relax.
- “Max plant lost ₹6.5 crore but will improve by H2.”→ Translation: Premium dreams, budget nightmares.
- “Durabuild JV opens us to a ₹12,000 crore chemicals market.”→ Translation: If tiles don’t stick, at
- least adhesives will.
- “Receivables are down by a day.”→ Translation: Small win, but in this industry, even one day is Diwali.
NUMBERS DECODED
| Revenue – The Hero | EBITDA – The Sidekick | Margins – The Drama Queen |
|---|---|---|
| ₹601 crore (+4%) | Pressured by low utilization | Fell as Max bled ₹6.5 crore |
- Revenue: Growth looks like a polite handshake, not a bear hug.
- EBITDA: Sidekick took the bullet from idle kilns.
- Margins: Sulking in the corner, blaming “premium” plants for betrayal.
ANALYST QUESTIONS
- On Durabuild: Analysts asked if it’ll move the needle. Mgmt said waterproofing is a ₹6,000 crore market—translation: “We’re praying Pidilite leaves crumbs.”
- On Morbi: Analysts asked if evasion-driven players threaten. Mgmt: “They’re billing at ₹10/sqft, let GST officers deal with them.”
- On costs: Asked if Somany will copy peers’ austerity. Mgmt: “We’re frugal already. No layoffs, just fewer flights.”
- On receivables: Analysts probed risk. Mgmt flexed: “Down a day. We’re saints.”
GUIDANCE & OUTLOOK
Somany is sticking to “high single digit” growth and 1–1.5% margin expansion for FY26. Management swears H2 will be “100 times better” (someone’s clearly been watching inspirational reels). The Durabuild JV could, in theory, diversify revenue—but new markets
