Century Plyboards reported strong Q2 FY27 results with revenue hitting Rs 1,780 crore, a 28.5% increase YoY. Net profit grew by 46% to Rs 104 crore, fueled by record sales in plywood and particleboard. Axis Securities maintains a BUY rating with a target price of Rs 820, citing management's strategic focus on debt reduction and operational efficiency.
Century Plyboards Q2 Revenue Hits Record Rs 1,780 Crore
Revenue grew 28.5% YoY to Rs 1,780 crore while Net Profit surged 46% to Rs 104 crore.
Reader Takeaway: Strong operational growth in core segments offsets concerns over competitive pricing and elevated timber costs.
What just happened
Century Plyboards posted robust financial results for the second quarter of FY27. The company achieved a consolidated revenue of Rs 1,780 crore, marking a 28.5% year-on-year increase. EBITDA reached Rs 230 crore, representing a 31.6% growth, while net profit grew 46% to Rs 104 crore.
Why this matters
The performance was driven by record contributions from the plywood and particleboard segments. Notably, the particleboard business crossed Rs 100 crore in quarterly revenue for the first time, growing 211% YoY. Management is signaling a shift toward financial consolidation, prioritizing debt repayment using internal cash flows over new capital expenditure until a 1x debt-to-EBITDA ratio is achieved.
Management Commentary and Guidance
Management expects sustained momentum for FY27, targeting an annual EBITDA of approximately Rs 900 crore. The focus remains on premiumization and utilizing new capacity, such as the recently operational Hoshiarpur greenfield plant. The company reports that net debt has peaked at roughly 2.4x EBITDA.
Risks to watch
Investors should monitor the potential impact of muted demand on plywood growth. Additionally, the MDF segment faces pressure from intense domestic competition and weak pricing. Rising timber costs remain a key variable that could compress margins if the company is unable to pass on price hikes to the end market.
What to track next
Watch for progress on the company's debt reduction path and the recovery of margins in the MDF segment. Shareholders should also monitor competitive pricing actions from the unorganized sector which could affect market share.