Greenpanel Industries (GREENPANEL) Q1 25/26 earnings summary

Executive summary

• Domestic MDF volumes grew 47% year-over-year on a like-for-like basis, but overall MDF volumes declined 8.5% due to discontinuation of commercial-grade MDF post-BIS QCOs; export volumes fell 40% year-over-year due to geopolitical disruptions and a focus on margins.

• Net profit was significantly impacted by a ₹27.6 crore currency loss on Euro borrowings for the new plant, resulting in a net loss after tax of ₹3,462.36 lakhs for Q1 FY26.

• Plywood sales remained subdued, with net sales declining 2.8% year-over-year, but are expected to revive as synergies with MDF business improve.

• Channel inventory buildup and aggressive pricing/credit strategies by competitors affected Q1 volume growth.

• Focus areas for upcoming quarters include expanding distribution, increasing value-added product share, and digital dealer engagement initiatives.

Financial highlights

• Q1 FY26 revenue was ₹32,819.35 lakhs (INR 323 crores), down 11.4% year-over-year and 4.8% sequentially.

• Gross margin improved to 47% for Q1, up 2.5% sequentially due to a 7% drop in timber prices, but down from 51% year-over-year.

• Operating EBITDA margin dropped to 4% from 10.9% year-over-year; reported EBITDA was negative INR 12.4 crores due to exceptions and currency losses.

• Net margin turned negative at -10.7% versus 4.3% in Q1 FY25; EPS was -₹2.82 compared to ₹1.28.

• Total expenses for the quarter were ₹37,900.43 lakhs, exceeding total income and contributing to the net loss.

Outlook and guidance

• No change in volume or margin guidance for FY 2026; focus remains on regaining lost market share and volume growth over the next nine months.

• Aggressive pricing and cost optimization strategies will be used to counter market pressures.

• Plans to widen distribution reach and increase domestic volumes and value-added product mix.