Pidilite Industries Ltd (PIDILITIND) Q2 FY27 Results Analysis: Revenue Jumps 20.91%, EBITDA Margin Compresses 351 bps

Pidilite Industries Ltd's Q2 FY27 numbers came in mixed, with revenue of Rs. 4,297.59 Cr (+20.91% YoY) and PAT growth of +7.16% YoY. Here's a quick read of what worked, what to watch, and what management said.

Quarter Snapshot

Revenue grew 20.91% YoY to Rs.4,297.59 Cr, the fastest print in the tracked period, but VAM/crude input inflation (materials +40.33%) compressed EBITDA margin 351 bps to 20.42% — at the floor of management's 20-24% FY27 corridor. Management delivered on its stated corridor and pricing playbook covered cost rather than margin, while working capital absorbed ~Rs.888 Cr, pulling CFO to 0.73x H1 PAT. The swing factor for H2 is whether staggered pricing begins recovering margin and the working-capital build unwinds.

Key Investment Insights

Key Positives

• Consolidated revenue grew 20.91% YoY to Rs.4,297.59 Cr, the fastest quarterly YoY print in the tracked period
• Consumer & Bazaar revenue grew 20.70% YoY and B2B grew 19.87% YoY
• Employee costs fell to 11.89% of revenue (from 13.24%) and other expenses to 16.24% (from 17.86%)
• EBITDA still grew 3.14% YoY to Rs.877.48 Cr despite input-cost inflation
• Effective ETR fell to 24.91% from 25.75% in Q2 FY26
• Net cash position of Rs.3,834.57 Cr maintained while paying Rs.1,170.55 Cr final dividend
• Capex at 2.99% of H1 revenue, within the 3-5% standing band edge
• EBITDA margin of 20.42% landed inside management's 20-24% FY27 corridor

Risk Factors

• Consol EBITDA margin compressed 351 bps YoY to 20.42%, at the floor of management's 20-24% corridor
• Gross margin fell 648 bps YoY to 48.56% as materials cost grew 40.33% and purchases 49.75% YoY
• B2B segment result declined 1.39% YoY on +19.87% revenue, with margin down 269 bps to 12.51%
• H1 CFO of Rs.1,098.11 Cr was 0.73x H1 PAT due to Rs.630.65 Cr receivables and Rs.303.15 Cr inventory absorption
• Subsidiary contribution swung to a Rs.32.47 Cr drag from −Rs.6.67 Cr in Q2 FY26
• Standalone other income of Rs.129.69 Cr (+89.3% YoY) includes dividend and FVTPL gains that flatter standalone PBT/PAT growth