Pidilite Industries shares surged nearly 5% to ₹344.20 on the National Stock Exchange during Wednesday's trading session, with nearly 5 million shares changing hands compared to just 770,226 shares traded on Tuesday. The strong market response reflects investor confidence in the company's robust Q3 FY26 performance and positive outlook for future growth. According to Informist Media, all three brokerage reports on the company maintain a 'hold' recommendation with target prices varying from a high of ₹427 to a low of ₹368, indicating cautious optimism about the company's prospects.
As reported by NDTV Profit, Pidilite Industries declared its earnings for Q3 FY26, reporting a 12% rise in consolidated net profit at ₹623.84 crore on a year-to-year basis. The company's revenue from operations stood at ₹3,709.91 crore, up 10.12% during the quarter. However, the company's industrial products revenue under its Business-to-Business (B2B) segment was impacted by lower exports, with EBIT declining by 77 basis points due to slower exports during the quarter. Vats confirmed that the company remains committed to delivering double-digit underlying volume growth in Q4 and will continue this trend in FY27, noting they have been achieving this quarter-on-quarter for several years.
According to Informist Media, the company's auto original equipment manufacturing and replacement segment reported a rise of over 25% on year for the December quarter, along with its industrial infrastructure segment, excluding telecommunication, which also saw double-digit growth. However, 8% of the company's business, primarily its telecom business, declined 38% on year. The telecom segment has bottomed out according to management, while the company's exports also reported a decline due to tariffs. Despite these challenges, the company's management expects strong growth in FY27, with the telecom segment showing signs of recovery and export orderbook remaining strong.
As reported by Informist Media, a rise in cost of commodities such as silver and tin impacted the company's margins, with the company taking an around 2% price hike in January and expecting the need to take one more. The company aims to improve its margins by 100-150 basis points. This cost pressure reflects broader commodity inflation challenges affecting the adhesives and chemicals sector, though the company's pricing actions and operational efficiency measures are helping to mitigate the impact on profitability.
According to reports from NDTV Profit, Pidilite Industries anticipates a quick recovery in its US exports, which slowed in Q3 FY26, following the India-US tariff revision. Managing Director Sudhanshu Vats stated that while the company's export component is small, it exports to the US and this has slowed down significantly. He expects the export decline to bounce back very quickly, potentially towards the end of the current quarter and moving forward. The company's total exports were ₹993 crore in Q3 FY26, and Vats expects this to correct as the tariff is rationalised. He noted that the B2B business, which supplies to various industries including leather chemicals and footwear, will also benefit indirectly from the India-US tariff revision, as these categories will get an impetus from the revised trade agreement.
The anticipated free trade agreements with the US and EU are projected to invigorate Pidilite's export business, which saw a dip in the December quarter due to tariffs. The US-India trade deal with reduced tariffs for Indian goods is expected to provide immediate benefits by enhancing the competitiveness of Indian exports, particularly in sectors like chemicals. The EU-India FTA, slated for implementation from FY2027, promises further market access and duty reductions across numerous product lines. While these agreements offer strategic advantages and restore predictability for exporters, the actual impact on Pidilite's bottom line will depend on raw material cost management and the company's ability to translate tariff benefits into improved margins through product mix optimization and cost efficiencies.
