Pidilite Industries prepares for another round of price increases amid rising raw material costs, as the company balances margin pressures with demand sustainability and shifting urban-rural dynamics.
Pidilite Industries is preparing another round of price increases as raw material inflation squeezes its margins, with managing director Sudhanshu Vats saying the company will act in a “calibrated” way to protect demand. Speaking about the latest quarter, Vats said the maker of Fevicol had kept growth intact despite selective price rises and noted that the first quarter is usually one of its strongest periods, helped by seasonal factors.
He said the business faced some pressure on gross margins as input costs rose, with the company absorbing part of the increase even as revenue growth provided operating leverage. The company has also pointed to a tougher cost environment linked to tensions in West Asia, which have pushed up the prices of crude-linked inputs used in its raw material basket.
Vats said the balance between urban and rural demand has been shifting, with city markets gaining ground over the past few quarters. In the latest period, he said urban growth came close to, and in some cases matched, rural growth for the first time in the first quarter, though he added that rural demand remained steady. He also said the monsoon has been uneven, although rainfall improved in parts of the country in July and August.
Analysts cited by Mint said Pidilite posted 9.9% underlying volume growth in the quarter, while the consumer and bazaar business delivered its best performance in five quarters. The company has previously said it aims to outpace India’s GDP growth over time, supported by advertising, distribution and construction-related demand. But recent reports suggest the near-term outlook is being shaped by inflation rather than just volume momentum, with management warning that margins in the current fiscal year’s first quarter may compress further if cost pressures persist. NDTV Profit said Pidilite had reported a 37.2% rise in fourth-quarter net profit to ₹579 crore on revenue of ₹3,583 crore, while also declaring a dividend of ₹11.50 per share for fiscal 2026.
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