Kajaria Ceramics has unveiled a concerning 22.81% decline in its net consolidated profit for the second quarter of FY25, which ended on September 30, 2024. The company’s profit after tax plummeted to ₹85.54 crore, down from ₹110.82 crore in the same quarter of the previous fiscal year. Despite this downturn in profitability, Kajaria reported a net consolidated total income of ₹1,189.14 crore, reflecting a modest growth of 5.24% compared to ₹1,129.89 crore recorded in the corresponding quarter last year.
Chairman attributed the profit decline to ongoing softness in domestic demand, although the company’s tile volumes showed resilience, growing by 8.5% year-on-year to reach 28.70 million square metres (MSM). However, this positive volume growth was overshadowed by the challenges faced in the bathware division, where EBITDA margins remained subdued at 13.5%. The losses incurred by the recently commissioned sanitaryware unit in Morbi, coupled with additional overheads from the newly operational Keronite unit, have impacted the overall financial performance. In light of the financial results, Kajaria’s board of directors declared an interim dividend of ₹5 per equity share for the financial year 2024-25, signalling their commitment to returning value to shareholders despite the challenging market conditions.
As of September 30, 2024, the company’s net worth stood at ₹2,698.30 crore, with a debt-equity ratio of -0.12, indicating a strong balance sheet. While the numbers reflect a tough quarter, the sentiment among stakeholders remains cautiously optimistic. Many industry experts believe that the sustained demand for ceramic products, driven by housing and infrastructure growth, may bolster future performance. Community responses to the profit decline highlight concerns over job security within the sector, as many workers rely on Kajaria for stable employment. The emotional weight of these figures resonates particularly in local areas where the company is a key employer. Consumers and employees alike hope that the company will pivot towards more sustainable production methods, reducing environmental impacts while ensuring long-term viability. The broader industry context reveals a shift towards sustainability as a crucial focus. As Kajaria navigates its challenges, the expectation is that it will embrace innovative practices that not only enhance profitability but also align with growing consumer demand for eco-friendly products. As the company looks ahead, the interplay between financial health and environmental responsibility will be pivotal in shaping its future.