Century Plyboards expects to surpass FY27 guidance, targets over 20% CAGR: Keshav Bhajanka

Century Plyboards (India) expects to surpass its revenue guidance for the current financial year and remains focused on achieving annual growth of over 20%, Executive Director Keshav Bhajanka said, adding that the company could reach the ₹10,000-crore turnover milestone earlier than previously anticipated.

"Our objective is always to achieve a 20% plus CAGR. So this current year, I think we will surpass that guidance," Bhajanka said in an interaction with Fortune India post-Q2 results announcement. "Having said that, I believe we might be able to achieve our ₹10,000-crore milestone slightly earlier."

Strong demand across product categories

Century Plyboards reported consolidated revenue from operations of ₹1,780.04 crore for the September quarter, up 28.5% from ₹1,384.34 crore in the year-ago period. Net profit rose 51.7% year-on-year to ₹106.28 crore.

Bhajanka said growth had been broad-based, with laminates registering growth of over 20%, while MDF also performed well, partly supported by a lower base and the addition of new capacity.

"If you remember earlier, we had invested substantially towards new capacity additions in MDF and in particular plywood, which took time to scale up. But now, once the base has stabilised, I think the fact that all are performing with a good growth rate is highly encouraging," he said.

He added that plywood had performed beyond the company's expectations, indicating brand strength and resilient domestic demand. Growth was spread across metropolitan and smaller markets, with both premium and economy product ranges seeing traction.

MDF oversupply weighs on margins

On profitability, Bhajanka said excess capacity in the MDF industry continued to put pressure on margins and had limited improvement in the company's consolidated EBITDA margin.

"Going forward, maybe over the course of next year, markets will correct when the demand-supply gap is bridged," he said, adding that margins across segments were improving.

"Our EBITDA margins will go up from here, but I don't think there will be any substantial uptick" immediately, he said.

The company is also holding back on fresh MDF expansion until the supply-demand imbalance in the market improves. Its upcoming plywood manufacturing unit, meanwhile, is expected to be in place by FY28, with the investment largely funded through internal accruals.