Duroply Industries reports 97.6% surge in H1 profit, fueled by rising sales

Duroply Industries Limited, India’s premium and most experienced plywood manufacturer, reported a sharp increase of 97.6% in its profit after tax (PAT) for the half year ended September 30, 2024. Profit soared to Rs. 3.81 crore from Rs. 1.93 crore during the same period last year, marking a significant upturn in the company’s profitability trajectory.

Duroply’s sales also recorded a strong growth of 10.4% in H1 FY25, reaching Rs. 175.62 crore compared to Rs. 159.15 crore in H1 FY24. However, despite the increase in revenue, the company saw a marginal decrease of 2.3% in its Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA), which dropped from Rs. 8.31 crore to Rs. 8.11 crore in H1 FY25.

Quarterly Performance Highlights For the quarter ended September 30, 2024, Duroply Industries reported a notable 9.0% increase in sales, climbing to Rs. 90.81 crore from Rs. 83.29 crore in the corresponding period of the previous year. Similarly, EBITDA witnessed a growth of 9.0% in Q2 FY25, rising to Rs. 4.00 crore from Rs. 3.67 crore recorded in Q2 FY24.

Despite these improvements, the company faced a 22.8% drop in profit after tax for the quarter, which fell to Rs. 49.88 lakh from Rs. 64.65 lakh in Q2 FY24. The decrease was primarily attributed to a reduction in deferred tax assets and an increase in deferred tax liabilities, which impacted the overall bottom line.

Managing Director’s Insights Akhilesh Chitlangia, Managing Director and CEO of Duroply Industries, commented on the results, stating that the sharp growth in sales and key metrics validated the company’s transformational journey over the past few years. Chitlangia emphasized that the company’s decision to strengthen its balance sheet was beginning to yield tangible results, notably in terms of improving gross margins.

Chitlangia acknowledged that rising costs of raw materials have presented industry-wide challenges. Nonetheless, he noted that Duroply’s strategic investments in infrastructure upgrades and team development are expected to continue enhancing operational efficiencies. Looking ahead, he remained optimistic, predicting that India’s growing real estate sector would benefit Duroply in the long term, creating sustained demand for their products.

Navigating Challenges in EBITDA Growth Although Duroply managed to grow its EBITDA in Q2 FY25 by 9%, the overall H1 FY25 figure dipped slightly compared to H1 FY24. Analysts believe this minor decline was mainly due to increased input costs driven by inflationary pressure on raw materials. Duroply, known for sourcing its raw materials sustainably, has taken steps to mitigate these impacts by investing heavily in cost management initiatives.

Industry experts believe that despite the pressure, Duroply’s strategic focus on expanding its infrastructure and investing in customer-centric innovations will eventually help it emerge stronger in a highly competitive plywood market.

Product Innovation and Market Leadership Duroply Industries is well-recognized for its innovative product offerings. It was the first company in the industry to offer a lifetime guarantee on most of its products, demonstrating its confidence in the quality of its products and its commitment to customer satisfaction. The company has also launched “Duro Plus,” which features an extended 10-feet range of plywood, boards, doors, and veneers—offering unmatched convenience and variety to consumers.

Another significant initiative by Duroply is the “Duro Advantage” program, which features nine key attributes that customers value the most, such as durability, termite resistance, and moisture protection. Duroply couples this with its “Duro Lifetime Guarantee,” setting a gold standard for the plywood industry and offering unparalleled assurances to customers.

Enhanced Consumer Engagement Recognizing the value of consumer education, Duroply has launched “Duro TV,” a YouTube channel dedicated to educating consumers on selecting the right plywood for their needs. Additionally, their podcast series “Beyond Blueprints” is focused on bridging the gap between interior designers, architects, and potential consumers, helping customers find the right professionals to bring their visions to life.

Growth Strategy Amidst Strong Competition Industry analysts have pointed out that the continued demand for quality plywood and interior solutions will likely support Duroply’s growth in the coming quarters. The company’s focus on sustainable sourcing has also resonated well with environmentally conscious customers, positioning it as a “Forest Friendly Company” amidst growing concerns about deforestation.

As the Indian real estate sector continues to grow, Duroply is poised to leverage these tailwinds, with the company already making strides in expanding its reach across both residential and commercial segments. The robust financial performance and strategic investments signal an exciting future for Duroply as it aims to capture an even larger share of the plywood market.