Kajaria Ceramics reported a 24% revenue jump to Rs 1,468 crore for Q2 FY27, driven by a 10% rise in sales volume. The company successfully gained market share by narrowing the price gap with Morbi-based manufacturers. Investors may track the execution of ongoing capacity expansion projects and the sustainability of its 19.6% EBITDA margin.
Kajaria Ceramics posted a strong performance in the second quarter of the 2027 fiscal year, with revenue climbing 24% to Rs 1,468 crore. The growth was supported by a 10% rise in sales volume, reflecting a strategic shift in the company’s market approach. By narrowing its price premium compared to manufacturers in the Morbi cluster, Kajaria has effectively pushed its products into a wider retail segment, gaining market share from smaller, price-sensitive competitors.
The company reported an EBITDA of Rs 287.5 crore, a 35% increase compared to the same period last year, while operating margins remained steady at 19.6%. This stability was achieved largely through efficient fuel cost management, including reliable gas sourcing and increased integration of biofuels. The deliberate shift in pricing strategy—bringing the premium down from a historical 40% to approximately 20-25%—is a calculated effort to compete more aggressively in a market where price sensitivity often dictates demand.
Beyond its core tile business, the company’s expansion into secondary product categories is showing momentum. Revenue from the adhesives segment rose by 69%, signalling that the company's diversification strategy is gaining traction. This growth in non-tile products helps create a more balanced revenue mix, which is helpful as the company navigates the cyclical nature of the construction and real estate sector.
To support its long-term growth targets, Kajaria is significantly scaling its manufacturing capacity with new projects in Srikalahasti and Gailpur. These facilities are expected to add 23.5 MSM to the company's total capacity. These investments are designed to boost in-house manufacturing, which aims to reduce reliance on third-party outsourcing and optimize regional logistics costs. The commissioning of these plants, currently slated for the first quarter of the 2027-28 fiscal year, is a critical milestone for the company’s goal of reaching 145 MSM in sales by FY28.
While the expansion plan provides a pathway to scale, it also introduces execution risks. The ultimate benefit of these new facilities will depend on the company’s ability to meet commissioning timelines and realize the projected operational efficiencies. Furthermore, the tile industry remains subject to energy price volatility and intense competition. While Kajaria has maintained stable margins, the company’s ability to defend these margins while aggressively chasing market share through narrowed pricing will be a key factor for investors to monitor in the coming quarters.