Pidilite Industries expects consumer demand to remain resilient despite inflationary pressures and does not see an immediate need for further price increases in the current quarter, according to Managing Director Sudhanshu Vats. The company, which took price increases of up to 12 per cent in tranches in the June quarter to offset the spike in crude prices triggered by the West Asia crisis, does not foresee the need for any fresh price hikes in Q2 amid easing volatility. However, Vats noted that crude prices remain volatile and could still trend higher, stating the company will watch this space carefully. As per Rediff Moneynews, Vats emphasized that 'We do not think that there is a necessity at this moment to take up any further price increase. But we will watch this space'.
Pidilite sees demand trends in July and August broadly in line with the June quarter, with overall consumer sentiment in India remaining 'reasonably robust', as reported by Vats. "If you look at Q1 demand, demand in Q2 as well, as we travel and qualitatively see, is broadly holding," Vats said, adding that he was pleasantly surprised by the resilience in overall consumer sentiment despite inflationary pressures. The company remains confident of delivering double-digit underlying volume growth in FY27 while maintaining profitability, aided by strong demand across both urban and rural markets. Vats stated that 'We will deliver double-digit underlying volume growth at a profitability corridor or a better profitability corridor of 20-24 per cent' and emphasized the company's commitment to its long-term growth strategy rather than chasing short-term revenue targets.
Vats explained that even if crude settles around $80 a barrel against the pre-crisis level of about $60, the impact typically plays out over roughly six months, and that a certain degree of 'built-in inflation' from both crude and rupee depreciation would eventually need to be passed on. The company has begun issuing rebates on select brands where input costs have eased, while maintaining its strategy to pass on only the absolute increase in raw material costs rather than seeking additional margin expansion. Pidilite's raw material basket includes Vinyl Acetate Monomer (VAM), a key ingredient sourced from crude derivatives, which is the primary raw material used to manufacture Polyvinyl Acetate (PVAc) for white wood adhesives. Vats noted that **'Crude prices, which were around USD 60 a barrel before the West Asia crisis, have now stabilised closer to USD 80, creating a
Unlike fast-moving consumer goods companies that have reported stronger rural growth than urban demand, Pidilite has not seen any significant weakness in cities because its products are linked to renovation, construction and repair projects rather than frequent monthly purchases. Urban demand has continued to remain healthy alongside strong rural demand, with Vats noting that 'We continue to see that uplift in urban demand as we go forward, rural is strong, but urban is also caught up. For us, the story is a little different'. The company plans to expand its international business, which contributes around 10 per cent of its overall revenue, focusing on South Asia while selectively building presence in Africa where it already has operations in Kenya and is building its footprint in Tanzania. As per Rediff Moneynews, Vats emphasized that 'We want to explore and selectively build Africa. We have presence in Kenya through a partner and are continuing to build Africa selectively as we go forward'.
Pidilite recently inaugurated a large manufacturing facility in Maharashtra and is evaluating another plant in northern India, while increasingly investing in larger-scale factories. The strategy follows the commissioning of a major facility in Visakhapatnam and reflects Pidilite's push to strengthen its manufacturing footprint across regions. On potential acquisitions, Vats said the company continuously evaluates opportunities but declined to comment on any specific transactions, stating the company keeps looking at opportunities all the time but cannot comment until anything is done. The company's focus remains on expanding its international presence beyond South Asia and Africa, with Vats noting that 'We will continue evaluating opportunities in Southeast Asia as part of our long-term international growth strategy'.
