Event Participants
Executives
2
Anand Sharma, Chirag Parekh
Analysts
11
Achal Mehta, Avijit Sheet, Balakrishna, Karan Gupta, Pavan Kumar, Pragyam Laddha, Pritesh Chheda, Resha Mehta, Saket, Shiladitya Mukhopadhyaya, Yash Nailwal
Financials & KPIs
| Metric | Reported | Commentary |
|---|---|---|
| Consolidated Total Income | ₹264.8 crore | +16.5% YoY, +12.2% QoQ; driven by volume growth, higher ASPs and operating leverage |
| Domestic Sales (India) | ₹56 crore | +39.8% YoY; 25% volume growth + 12% average price realization growth reflecting premiumization |
| Export Sales (India Ops) | ₹111 crore | +10.6% YoY; logistics/container delays impacted dispatches in Q1 |
| EBITDA | ₹56 crore | +27% YoY; margin 21.2% vs 19.4% (+175 bps YoY, +89 bps QoQ); driven by operating leverage, product mix and scale |
| EBIT | ₹46.8 crore | +31.2% YoY; margin improved 198 bps |
| PAT | ₹31.4 crore | +37.7% YoY; margin 11.9% vs 10.1% (+183 bps YoY) |
| EPS | ₹11.05 | +37.6% YoY vs ₹8.30 in Q1 FY26 |
| Quartz Sink Volume | 2.01 lakh units | +6% YoY vs 1.89 lakh units; capacity utilization at ~80%, growth dampened by container delays |
| Stainless Steel Volume | 49.4 thousand units | +16% YoY vs 42.5 thousand units; new OEM wins, capacity at ~94% (weighted average post 70,000 unit expansion) |
| Kitchen Appliances Volume | 9.8 thousand units | +12% YoY; 53% of appliances now produced in-house |
| Faucet Volume | 12.5 thousand units | +43% YoY vs 8.7 thousand units; fastest growing category, 67% manufactured in-house |
Geographic & Segment Commentary
Quartz/Granite (51% of revenue): Volume grew just 6% YoY despite strong order book due to customer-nominated container delays of 1-2 weeks; production ran at ~80% capacity (June exit ~90%). Expansion of 260,000 units on track for completion by end FY27. Demand visibility remains healthy across export and domestic channels.
Stainless Steel (12% of revenue): Volume +16% YoY with new 70,000-unit capacity commissioned mid-quarter taking total to ~250,000 units at ~94% utilization. Additional 150,000 units targeted for March FY27. Kohler nearly doubled volumes; premium stainless steel and granite finishes launched, driving ASP expansion.
Faucets (25% of revenue): Volume +43% YoY; portfolio expanded into stainless steel, brass and 3D finishes with initial Europe traction. RO-enabled drinking water systems launched in India with ~60-day backlog. 95-97% of faucet sales remain domestic; exports to scale after technical collaboration and machine upgrades are completed.
Kitchen Appliances (11.8% of revenue): Volume +12% YoY; 53% now manufactured in-house. CX range expanded with built-in refrigerators and high-end ovens; initial UAE/Oman consignment sold out. E-commerce channel expected to grow 3x this year via Amazon, Flipkart and Sync Pocket.
India: Domestic sales at ₹56 crore (+39.8% YoY) with all four categories growing (quartz +31%, steel +60%, appliances +28%, faucets +45%). Distribution expansion: 40-50 galleries, 11 brand stores (34 committed in Q2), 180 stores targeted over next two years. New B2B vertical penetrating Tier 2/3 builders through complete kitchen combos.
International/UK: Export from India +10.6% YoY with UK market "tight phase" but new customer wins (Bodel, B&Q across UK/Northern Ireland). Builder/project market was previously untapped; new customers expected to drive recovery from Q2. New Manchester showroom launching Q3 FY27. UK homebuilding pipeline supportive but market expected to remain modest.
US/Australia/NZ: Home Depot partnership extended across US and Canada; first orders secured from Amazon US. Collaborative agreement signed with Bunnings (Australia/NZ). Lowe's display renovation deal (~USD 5-6 million); partner contributions reduce tariff-related discount burden going forward.
Company-Specific & Strategic Commentary
Capacity Expansion: Capex of ₹80-90 crore planned for FY27 — ₹40-50 crore for granite sink expansion, ~₹20 crore stainless steel, ~₹20 crore faucets/appliances. Land acquired for new B2B/B2C OEM clients (Kohler, etc.). Steel capacity expanded by 70,000 units mid-quarter; 150,000 additional steel units and 260,000 quartz units due by March FY27.
Product & Technology Innovation: First company in India to introduce CNC automated fabrication process for kitchen surfaces — US market est. USD 50 billion, global ~USD 100 billion. Carousel Blue D2C bathroom brand targets first 10 brand stores by end of CY26. Launch of RO-enabled drinking water products under acquired UK technology platform.
Tariff Discount Normalization: ~90% of US tariff-related discounts rolled back, effective from June 2026; remaining rollback contribution being directed to Lowe's display program. This, combined with premium product launches, drove ASP improvement in Q1.
Global Expansion: New relationships secured with IKEA, Royal Housing UK, Amazon; Qatar/Gulf markets being entered; production targets moving to factory running 7 days/week at "highest ever" export order book.
Guidance & Outlook
| Metric | Guidance / Outlook | Commentary |
|---|---|---|
| Revenue Growth (FY27) | ~15% value and ~15% volume | Maintained guidance; expects ASP improvements to drive value growth slightly above volume |
| EBITDA Margin (FY27) | 18-20%, tracking upper end | Supported by operating leverage, product mix, scale; rollback of US discounts adds tailwind |
| Capex (FY27) | ₹80-90 crore | Granite ₹40-50 cr, steel ~₹20 cr, faucets/appliances ~₹20 cr; annual maintenance capex ~₹50-60 crore minimum |
| Capacity (by Mar FY27) | +260,000 quartz units; +150,000 steel units | Steel 70,000 already added mid-quarter; land acquired, construction progressing |
| Domestic Growth (FY27) | Expected acceleration in Q2/Q3 | 90-day Festive Plan (Sep-Nov) and 8-city Celebrity Chef Roadshow to drive demand |
| Carousel Blue Stores | ~10 stores by end CY26/March FY27 | First store operational; testing SKUs and colors before scaling |
| Long-term Target (5 yrs) | Next ₹1,000 crore revenue | 15% value CAGR assumed; achieves ~15% annual growth to ₹2,000+ crore |
Risks & Constraints
| Risk | Context |
|---|---|
| Logistics/Container Delays | Customer-nominated containers delayed 1-2 weeks caused ~6% quartz volume growth vs expectations in Q1; management expects recoveries from Q2 as backlogs shift |
| UK Market Softness | UK retail/merchant business in "tight phase"; management "cautiously optimistic" and relying on new customer wins (Bodel, B&Q) to offset macro headwinds; homebuilding pipeline supportive but timing uncertain |
| Capacity Constraint | Steel utilization at ~94% with factory required to run 7 days/week; expansion timelines (March FY27) could slip, creating short-term supply risk during peak festive season |
| Residual US Tariff Exposure | ~10% of discount rollback not yet reclaimed; management channeling partner contributions toward Lowe's display program (USD 5-6 million) rather than direct margin capture, creating execution risk if partner commitments vary |
Q&A Highlights
Quartz Volume & Export Logistics
- Question: Why was quartz growth single-digit and international subsidiaries (UK fabrication) sluggish? (Pritesh Chheda)
- Answer: Container delays (1-2 weeks) pushed end-of-quarter dispatches into Q2; UK is in a "tight phase" but new customer wins will restore momentum. No supply-side challenges — inventory adequate, only logistics scheduling issues. (Chirag Parekh)
OEM Deal Flow & Utilization
- Question: When will the OEM relationships announced over the past 4-6 quarters start reflecting in P&L? (Pritesh Chheda)
- Answer: Already flowing — steel utilization averaged 80% in Q1, exiting June at ~90%; "highest ever" export order book with new SKUs across Lowe's, Home Depot and Amazon. Challenge is capacity, not demand; exploring productivity gains and 7-day operations to bridge until expansion. (Chirag Parekh)
ASP, Pricing & Tariff Reversal
- Question: Were margin gains from price hikes or mix; is 94% steel utilization including the 70,000-unit addition? (Avijit Sheet)
- Answer: Operating leverage, US discount rollback (90% completed, effective June) and premium stainless steel/granite launches drove ASP. Utilization was on weighted average days post mid-quarter capacity addition. India demand and Kohler doubling volumes are key steel drivers. (Chirag Parekh, Anand Sharma)
UK Builder Market Entry
- Question: Should we explore the UK builder/project segment given the 1.5 million home-building target? (Resha Mehta)
- Answer: Yes — new customers (Bodel, B&Q) are project-focused; till now builder market was "essentially not tapped" in UK; expect improving UK contribution from Q2 onward. (Chirag Parekh)
Faucets & RO Water Systems
- Question: Is faucet revenue largely domestic? What about the UK company acquisition? (Resha Mehta)
- Answer: 95-97% faucet revenue is India; UK acquisition was for RO water technology — India launch has been "tremendous" with a 60-day backlog. Exporting faucets will wait until quality and machine upgrades are completed; exploring European technical collaboration. (Chirag Parekh)
India B2B Split & Builder Exposure
- Question: What is the B2B/B2C revenue split in India, and will builders accept premium pricing? (Resha Mehta)
- Answer: ~20% of India revenue is B2B, including builders/projects. Company focuses only on quality-conscious builders (e.g., DLF, M3M) that accept premium products; bare-shell apartment trend is creating new owner-driven kitchen upgrades, supporting B2B growth. (Chirag Parekh)
United Granite Margins & Surfaces Fabrication
- Question: What's driving 20%+ revenue growth and margins in United Granite (UK subsidiary)? (Resha Mehta)
- Answer: "Cut less, make more" strategy — invested £1 million in high-end exotic Italian stones (same manufacturing cost, higher ASP), lifting gross margins from ~35% to ~50%. For India surfaces: CNC fabrication unit on track for March FY27; this will be first-in-India automated fabrication for countertops. (Chirag Parekh)
OEM Channel Conflict with Own Brand
- Question: Won't increasing own-brand sales conflict with OEM partners? (Achal Mehta)
- Answer: No — OEM partners are fully aligned; channels, models, and price points are differentiated. Different categories (private label vs. Carysil premium brand) address different markets. (Chirag Parekh)
Granite Sink Capacity Phasing
- Question: Why expand 250,000 units instead of planned 100,000? Any demand concern? (Balakrishna)
- Answer: No demand issues — expansion needed to support signed deals; infrastructure designed for 500,000 units. "Carousel is now very competitive in the global sink space" driving large international opportunities. (Chirag Parekh)
Built-in Appliances Opportunity
- Question: How does India market for built-in refrigerators look over next 3-4 years? (Balakrishna)
- Answer: Very early stage; UAE/Oman where 80% of appliance sales are built-in and 40%+ of those are refrigerators — initial Carysil CX refrigerator consignment sold out; company will have more precise India read in coming quarters. (Chirag Parekh)
Tariff Payback Timing & Quantum
- Question: Is the tariff discount reversal in this quarter's revenue, and what's the quantum? (Pragyam Laddha)
- Answer:
90% rollback effective June 2026 — prices restored to original levels (built into pricing, not a one-time credit). Remaining ~10% will be offset through Lowe's display contribution (USD 5-6 million across 1,890 stores), which otherwise would have been shared discount cost. (Anand Sharma, Chirag Parekh)
Revenue vs Volume Guidance
- Question: Clarification on 15% growth — is it volume or value? (Saket, Shiladitya Mukhopadhyaya)
- Answer: Both are ~15% value and ~15% volume for FY27 on maintained pricing; ASP trend is improving, so value could exceed volume. Long-term target: ₹1,000 crore incremental revenue over ~5 years at 15% CAGR. (Chirag Parekh)
FY27 Capex Plan
- Question: Can you reiterate FY27 capex allocation? (Pavan Kumar)
- Answer: Total ₹80-90 crore for FY27: granite sinks ₹40-50 crore, stainless steel ~₹20 crore, faucets/appliances ~₹20 crore; ~80% of investment on core kitchen sink products. Annual maintenance capex of minimum ₹50-60 crore required to sustain 15% growth. (Chirag Parekh)
Key Takeaway
Carysil delivered a strong Q1 FY27 with consolidated income of ₹264.8 crore (+16.5% YoY), EBITDA of ₹56 crore (+27% YoY, 21.2% margin) and PAT of ₹31.4 crore (+37.7% YoY), with domestic sales surging ~40% to ₹56 crore. Management maintained its 15% revenue and 18-20% EBITDA margin guidance for FY27, now tracking toward the upper end, citing sustainable operating leverage, premium product mix and normalization of US tariff discounts. Strategic momentum is centered on capacity expansion — steel at ~94% utilization and quartz at ~80% — with ₹80-90 crore capex to add 260,000 quartz and 150,000 steel units by March FY27. New wins across Home Depot, Amazon US, Bunnings AU/NZ, plus a USD 5-6 million Lowe's display program, support the "highest ever" export order book. Watch points: logistics disruptions, UK market softness, capacity timing ahead of festive demand, and residual tariff exposure. Management remains focused on building "the next ₹1,000 crore" with sustained double-digit growth and industry-leading margins.