(Reuters) -India’s Kajaria Ceramics reported fourth-quarter profit well below expectations on Tuesday due to lacklustre prices and demand for its tiles, and said it will discontinue its loss-making plywood business.
The company’s consolidated net profit dropped more than 58% to 425.2 million rupees ($5 million) in the quarter ended March 31. Analysts, on average, had estimated a profit of 1.01 billion rupees, per data compiled by LSEG.
Its stock, which had been trading lower through the day, fell 4% after results. The company has missed profit expectations for all four quarters of fiscal 2025.
Losses in its plywood business widened to 307.9 million rupees in the reported quarter, from 26.8 million rupees a year ago.
The segment, in which Kajaria competes with the likes of Century Plyboards and Greenply Industries, is no longer a “strategic fit” and will be discontinued, it said.
Favourable weather in the reported quarter boosted construction activities, benefitting allied sectors, like cement makers.
However, with customers increasingly opting for cheaper, unbranded alternatives from unorganised players, tile manufacturers such as Kajaria and peer Somany Ceramics have been struggling with weak demand for their branded products.
“In Q4 FY25, we witnessed very soft demand in the domestic as well as the export market… The industry scenario is a bit challenging,” Chairman Ashok Kajaria said in a statement.
Its volumes grew 2% in the fourth quarter, missing HDFC Securities’ expectations of an 8% volume growth.
Revenue rose 1% on-year to 12.22 billion rupees, also missing analysts’ estimates of 12.83 billion rupees.
($1 = 84.4110 Indian rupees)
(Reporting by Hritam Mukherjee in Bengaluru; Editing by Sumana Nandy and Janane Venkatraman)
