Conference Call Analysis

Executive Summary

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Grasim Industries Q2 FY'26 Earnings Call – Cement/Building Materials Focus

Detailed Analysis

Grasim delivered solid operational and financial performance in Q2 FY'26, with consolidated revenues reaching INR1,59,663 crores on a trailing 12-month basis (up 8% YoY), while standalone revenue hit a record INR9,610 crores (up 26% YoY). The company's diversified portfolio spans cement (via UltraTech), decorative paints (Birla Opus), chemicals, cellulosic fibers, and B2B e-commerce (Birla Pivot).

Cement Business (UltraTech): Sales volume grew 6.9% YoY to 33.85 million metric tonnes in Q2 FY'26. Operating EBITDA per metric tonne expanded significantly by 32% YoY to ₹966, driven by volume growth, realization improvements, and cost savings in power, fuel, and logistics. The business continues to support India's infrastructure capex cycle. UltraTech recently announced capacity expansion targeting over 240 million metric tonnes per annum by March 2028 (vs. current 192.3 million MT capacity).

Decorative Paints (Birla Opus): The business demonstrated exceptional growth trajectory, with September 2025 marking the highest-ever monthly sales and strong October performance. Despite facing full monsoon season impact in Q2 (industry suffered double-digit QoQ decline), Birla Opus recorded only low single-digit QoQ decline while achieving significant YoY growth. The company achieved #3 market position with double-digit decorative paint market share. Distribution reached 10,000+ towns (vs. original guidance of 8,500), with 500+ branded exclusive stores and 50,000+ active distributors. Installed capacity reached 1,332 million liters per annum across six plants post-Kharagpur commercialization. Management targets INR10,000 crores revenue by FY'28 and aspires to reach #2 position with profitability within three years of full-scale operations.

Key Cost Drivers: Cement EBITDA per tonne benefited from lower power, fuel, and logistics costs. Paints business is expanding through premium product mix (65% of revenue from premium/luxury products) and operational leverage from six-plant network.

Guidance & Key Targets: Management expects continued double-digit QoQ growth in paints in Q3, with significantly higher YoY growth. Birla Pivot B2B e-commerce business (annualizing >INR6,000 crores) is on track for INR8,500 crores (USD1 billion) by FY'27, with potential to achieve this sooner. Net debt improved to INR6,861 crores from INR7,153 crores; standalone net debt/TTM EBITDA at 2.19x vs. 2.41x previously.

Notable Event: CEO of Birla Opus, Rakshit Hargave, announced resignation effective December 6, 2025. Managing Director Himanshu Kapania will oversee paints operations until successor is appointed; strategy remains unchanged.

Macro Context: Management navigates a low-speed global economy with pockets of strength, moderated U.S. interest rates (Fed cut to 3.75%-4.00%), China's slowing growth (4.8% YoY in Q3 2025), and India as the positive outlier benefiting from GST rationalization and supportive RBI policy.

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GRASIM INDUSTRIES Q2 FY'26 EARNINGS CALL ANALYSIS

Building Materials & Cement Focus

1. OPERATIONAL PERFORMANCE

Sales & Production Volumes

Cement (UltraTech) – Consolidated Sales Volume

Metric	Q2 FY'26	Growth
Sales Volume	33.85 Million Metric Tonnes	+6.9% YoY
Installed Capacity	192.3 Million MT/annum (Q2)	Baseline
Announced Target Capacity	>240 Million MT/annum	By March 2028

Management Statement on Volume Growth:
"With every incremental million ton added, the business is structurally strengthening supply to support the country's historic capex cycle across roads, ports, industrial corridors, logistics infrastructure and housing." — Hemant Kadel, CFO

The 6.9% volume growth reflects strong demand from India's infrastructure and housing sectors. The business is reinforcing its position as India's largest cement producer while managing capacity expansion to meet structural demand from government-led capex initiatives.

Decorative Paints (Birla Opus) – Distribution & Sales Momentum

Metric	Current Status	Progress
Distribution Reach	10,000+ Towns	Exceeded original guidance of 8,500 towns
Active Distributors	50,000+	Target achieved
Branded Exclusive Stores	500+ towns	En route to 4-digit store count
Installed Capacity	1,332 Million Liters/annum	Post-Kharagpur commissioning (Oct 15, 2025)
Monthly Active Dealers (Throughput)	Growing sequential participation	120-130% secondary sales in Sept-Oct vs. primary purchases

Market Performance & Share Trajectory:

Management emphasized dealer participation dynamics: "The number of dealers participation has grown as well as number of products sold has grown, both in September and October." — Himanshu Kapania, MD

The business hit a critical inflection point in September-October 2025, post-monsoon recovery. Secondary sales (dealer-to-contractor/consumer throughput) reached 120-130% of primary dealer purchases in September and October, indicating rapid inventory turns and strong end-market demand. This is a key operational metric for assessing channel health in paints distribution.

Q2 Market Share Context:
"As per our estimates, excluding Birla Opus revenues, the organized decorative paint industry has degrown slightly on a year-on-year basis." — Himanshu Kapania

This statement underscores Birla Opus's market-expanding role. Despite an industry facing headwinds (low single-digit growth for organized decorative segment), Birla Opus drove incremental demand. The company achieved #3 position with double-digit market share including Birla White putty, mirroring legacy incumbents' disclosure practice.

Capacity Utilization & Logistics Normalization

Cellulosic Stable Fiber (CSF) Segment:

"The average quarter 2 FY '26 cellulosic stable fiber utilization rates in China have improved to 89%. And inventory days, though higher year-on-year, have sequentially reduced to 15 days." — Hemant Kadel, CFO

CSF utilization improved to healthy levels (89%), though the segment faced logistics headwinds in Vilayat that have since normalized. Sales volume declined 5% YoY due to these temporary logistics issues, but specialty fiber mix improved to 24% of sales (higher-margin products), partially offsetting volume declines through improved realization.

Chemicals Segment – Production Constraints:

"Caustic sales volume for the quarter were flat due to constrained production on account of lower power availability." — Hemant Kadel, CFO

Caustic soda volume remained flat YoY despite strong pricing, indicating a supply constraint from power availability—a critical operational bottleneck. However, specialty chemicals recorded robust 34% volume growth YoY, driven by stabilization of newer production capacity, demonstrating operational flexibility within the chemical portfolio.

2. FINANCIAL PERFORMANCE

Consolidated & Standalone Revenue

Metric	Q2 FY'26 / TTM	Prior Period	Growth
Consolidated TTM Revenue	INR1,59,663 Crores (~USD18B)	INR1,47,800 Cr (approx)	+8% YoY
Standalone Revenue (Record High)	INR9,610 Crores	INR7,630 Cr (Q2 FY'25 est.)	+26% YoY
Standalone as % of Consolidated	24%	~18-19%	Share gain

Management Statement on Revenue Momentum:
"Grasim's growth continues to exhibit resilience with trailing 12-month revenues now nearing INR1,60,000 crores, that is over USD18 billion compared to approximately INR95,000 crores, that is USD11 billion in FY '22 when measured on equal currency rates, a remarkable growth of 14%." — Himanshu Kapania, MD

This represents a 14% CAGR from FY'22 to TTM FY'26, demonstrating robust scaling despite macro volatility.

Business-Wise EBITDA & Profitability

Cement (UltraTech) – EBITDA per Tonne (Critical Metric)

Metric	Q2 FY'26	Q2 FY'25	Growth
Operating EBITDA per Metric Tonne	₹966	~₹732 (implied)	+32% YoY
Drivers	Volume growth + Realization improvement + Lower power/fuel/logistics costs	—	—

Management Commentary:
"Operating EBITDA per metric ton grew by 32% year-on-year to ₹966 led by volume and realization growth, coupled with lower power, fuel and logistics cost." — Hemant Kadel, CFO

This 32% YoY expansion in per-tonne EBITDA is a standout metric, reflecting:

Realization strength – Domestic caustic prices supported by stable demand; rupee depreciation aided realizations
Cost deflation – Power availability improved in certain regions; logistics costs normalized post-monsoon
Volume leverage – 6.9% volume growth provided operating leverage

Cellulosic Fiber Business – EBITDA Pressure:

"The cellulosic fibers segment revenue were up 1% year-on-year to INR4,149 crores. High input price of key raw materials impacted the EBITDA, which degrew by 29% to INR350 crores." — Hemant Kadel, CFO

Metric	Q2 FY'26	Q2 FY'25	Change
Revenue	INR4,149 Cr	INR4,104 Cr (implied)	+1% YoY
EBITDA	INR350 Cr	INR493 Cr (implied)	-29% YoY
Implied EBITDA Margin	~8.4%	~12%	-360 bps

CSF segment faced headwinds from elevated raw material costs despite modest revenue growth. However, specialty fiber volume improved to 24% (vs. lower-margin commodities), partially supporting realization. Currency depreciation aided blended realization, but input cost inflation overwhelmed benefits.

Chemicals Business – Mixed Performance

"The business revenue stood at two year high levels driven by all-round performance across caustic soda, chlorine derivatives and specialty chemicals." — Hemant Kadel, CFO

Caustic Soda: Domestic prices elevated (vs. 5% decline in global CFR SEA prices) due to stable demand and rupee depreciation; however, volume flat due to power constraints
Specialty Chemicals: Revenue contribution improved to 30% (vs. 26% in Q2 FY'25), driven by 34% volume growth from newer capacity stabilization
Chlorine Derivatives: Profitability pressured by negative chlorine realizations, despite 11 KTPA capacity addition in aluminum chloride

Chlorine Integration Status:
"Post completion of ongoing projects, chlorine integration is expected to reach 70% compared to current 64%." — Hemant Kadel, CFO

Integration of CPVC (with Lubrizol) and ECH projects (mechanical completion expected Q3 FY'26) will unlock downstream value and improve caustic utilization efficiency.

Decorative Paints (Birla Opus) – Premium Mix Expansion

"On the product front, the premium and luxury products revenue contribution was upwards at 65% of revenue, covering all categories across emulsion enamel, wood finish and waterproofing, including retail and institutional segment." — Himanshu Kapania, MD

Premium/luxury products now represent 65% of Birla Opus revenue mix (vs. baseline of ~50-55% typical for emerging paint brands). This indicates successful positioning in the aspiration segment, supporting higher realized pricing despite aggressive distribution expansion.

Product Portfolio Expansion:

190+ products in portfolio
13 new products launched in Q2 FY'26
New categories: Branded tools ("Artist" sub-brand), wallpapers (made-in-India), aerosols, clear varnish

Net Debt & Balance Sheet

Metric	Q2 FY'26	Q1 FY'26	Change
Consolidated Net Debt	INR6,861 Cr	INR7,153 Cr	-INR292 Cr (-4%)
Standalone Net Debt/TTM EBITDA	2.19x	2.41x	-22 bps

Management Commentary:
"On the balance sheet side, net debt declined by INR292 crores and stood at INR6,861 crores as on 30th September 2025 as against INR7,153 crores as on 30th June 2025. Stand-alone net debt to TTM EBITDA stood at 2.19x as against 2.41x." — Hemant Kadel, CFO

Debt reduction of INR292 crores in a single quarter reflects strong cash generation from core operations, offsetting capex investments. The 22 bps improvement in leverage indicates deleveraging momentum, with near-term target of 2.0x leverage appearing achievable given ongoing margin expansion.

3. COST ANALYSIS & OPERATIONAL EFFICIENCY

Power & Fuel Cost Efficiency (Cement)

Management Statement:
"Operating EBITDA per metric ton grew by 32% year-on-year to ₹966 led by volume and realization growth, coupled with lower power, fuel and logistics cost." — Hemant Kadel, CFO

The 32% EBITDA/tonne expansion was underpinned by:

Power cost reduction – Likely from improved grid availability post-monsoon
Fuel cost normalization – Pet coke and coal prices likely moderated from earlier peaks
Logistics cost decline – Freight normalization and improved logistics network utilization

Renewable Energy Transition (Chemicals Division):

"So firstly, we are at about 24%, 25% renewable level as of now, right? If I look at all that we have and all the state-level regulations, we expect that in the next three years, we should be able to technically get to 40%." — Jayant Dhobley, Business Head, Chemicals

The chemicals division currently sources 24-25% of power from renewables, with an aspirational target of 40% within 3 years. At current market rates, a 15-percentage-point increase in renewable energy share could reduce power costs by ₹3-5/kg of caustic soda (depending on state regulations and power procurement costs), translating to material margin expansion.

Input Cost Pressures (Cellulosic Fibers)

"High input price of key raw materials impacted the EBITDA, which degrew by 29% to INR350 crores." — Hemant Kadel, CFO

Raw material inflation (likely pulp, dyes, and chemical additives) compressed CSF EBITDA despite modest revenue growth. Management provided no specific mitigation commentary, indicating pricing power remains constrained in commodity fiber markets facing Chinese import competition.

Specialty Fiber Mix Benefit:

"Specialty fiber volume mix improved to 24%, led by higher exports of specialty fibers, improved product mix and currency depreciation supported blended realization of CSF." — Hemant Kadel, CFO

Uptrading to specialty fibers (24% of volume) and currency depreciation provided modest offsetting benefits, but insufficient to overcome raw material headwinds—a critical challenge for this segment.

4. GUIDANCE, OUTLOOK & TARGETS

Macro Environment & Demand Outlook

Global Economy Assessment:

"Globally, this a low speed economy with pockets of strength, intermittent confidence and policymakers for moving carefully, not boldly. The world is not constant. And in this environment, winners will not be those who bet on direction. Winners will be those who stay flexible on timings." — Himanshu Kapania, MD

Management frames the macro environment as low-velocity but not recessionary, with key drivers:

U.S. Monetary Policy: "On October 29, 2025, the Fed cut the target range for the federal fund rate by 25 basis points to 3.75% to 4%, the lowest in three years. This followed an earlier cut of 25 basis points in September." — Himanshu Kapania
China Slowdown: "China's GDP growth slowed to 4.8% year-on-year in quarter 3 of this calendar year 2025, the weakest pace in a year. Data shows China is not in an acute crisis, but in a structurally lower growth orbit. Property demand is frozen, household confidence is weak and private entrepreneurs are holding back capex decisions." — Himanshu Kapania
India as Positive Outlier: "The country is the positive outlier in the sentimental spectrum, but even India cannot fully decouple from the global liquidity and global trade." — Himanshu Kapania

India-Specific Tailwinds:

"In a landmark move in September 2025, the center rationalized GST slabs from 4 to 3, reducing taxes across essential and aspirational items… India's GDP growth for FY '25, '26 was revised upwards, thanks to a strong domestic consumption, robust investment activity and resilient exports." — Himanshu Kapania

GST rationalization, upward GDP revisions, and accommodative RBI policy support infrastructure and housing demand—primary drivers for cement and paints volumes.

Cement (UltraTech) – Capacity & Volume Targets

Announced Capacity Expansion Plan

"The business has recently announced capacity expansion targeting total gray cement capacity of over 240 million metric ton per annum by March 2028. Compared to its current capacity of 192.3 million metric ton per annum for quarter 2 FY '26…" — Hemant Kadel, CFO

Target	Metric	Timeframe
Cement Capacity	>240 Million MT/annum	By March 2028
Current Capacity	192.3 Million MT/annum	Q2 FY'26 baseline
Incremental Capacity	~48 Million MT	~25% expansion

Implication: At 33.85 MT sales volume in Q2 (with ~82% capacity utilization), an additional 48 MT capacity expansion supports 176 MT annual run-rate cement sales by FY'28 (assuming similar utilization), implying 4.6% CAGR volume growth from FY'26 to FY'28.

Strategic Rationale:

"UltraTech's capacity expansion continued to reinforce its position as the backbone of India's infrastructure build-out… supporting the country's historic capex cycle across roads, ports, industrial corridors, logistics infrastructure and housing." — Hemant Kadel, CFO

Long-Term Revenue Target

Target	Value	Timeframe	Reference
Decorative Paints Revenue	INR10,000 Crores	FY'28	Guidance (confirmed in Q&A)
Market Position	#2 in India	Within 3 years of full-scale operations	Committed target
Profitability	Positive/Sustainable	Within 3 years of full-scale operations	Management commitment

Verbatim Management Confirmation:

"Our vision that the company has announced to the market, we have committed to be number two as well as profitable within three years of full-scale operation." — Himanshu Kapania, MD (responding to market share acceleration query)

"Your guidance of INR10,000 crores turnover by FY '28, does that remain valid?" "Yes." — Percy Panthaki (IIFL), Himanshu Kapania (MD)

Capacity Utilization Path to INR10,000 Crores

Current Status (Q2 FY'26):

Installed Capacity: 1,332 Million Liters/annum
Distribution: 10,000+ towns, 50,000+ active distributors
Brand Position: #3 with double-digit market share

Implied Volume Growth to INR10,000 Cr by FY'28:

Assuming ASP (average selling price) of ₹150-160/liter for decorative paints (industry benchmark)
INR10,000 Cr ÷ ₹155/liter = ~65 Million liters annual volume required
Current implied volume: ~Q2 quarterly ~6-7 ML (annualized ~24-28 ML)
Required Growth: 65 ML ÷ 26 ML = 2.5x increase or ~60% CAGR (FY'26-FY'28)

Capacity Utilization: At 65 ML annual sales, utilization of 1,332 ML capacity = 4.9% — indicating significant room for volume scaling without fresh capex, supporting margin expansion through operational leverage.

Q3 FY'26 Guidance – Double-Digit Sequential Growth

"We are highly optimistic and results of September and October bear us out of a strong quarter 3, both on a year-on-year basis as well as a quarter-on-quarter basis. So our guidance is continued double-digit growth on a quarter-on-quarter basis and a significantly high growth on a year-on-year basis." — Himanshu Kapania, MD

Implication: Q3 expected to deliver:

Sequential (Q2→Q3) Growth: Double-digit (≥10% QoQ)
Year-on-Year Growth: "Significantly high" (likely >30% YoY based on Sept-Oct momentum commentary)

This suggests Q3 FY'26 revenues could reach ₹800-900 crores for Birla Opus decorative paints (vs. implied Q2 of ~₹700-800 crores).

"Our aim is to ensure that the volume market share and capacity market share converge all investments and all efforts, whether it's advertising, manpower, distribution, servicing and any new initiatives will be directed towards to match our volume market share closer to our capacity share." — Himanshu Kapania, MD

Capacity Market Share: 1,332 ML ÷ ~5,500 ML (estimated organized India capacity) = 24% of industry capacity

Current Volume Market Share: ~6-7% (double-digit % of decorative segment, but lower percentage of total organized paint market including putty and industrial)

Next Growth Drivers (Management Articulated):

Birla Opus Assurance Campaign – "First ever written paint promise by any paint company to assure the customers of painting performance backed by superior product quality" (thousands of projects registered)
PaintCraft Painting Services – "PaintCraft has already scaled up across 170 towns and expected to reach 300+ towns by quarter 3" with EMI financing and GST compliance (first in India)
Painter & Contractor Network Development – "The Birla Opus products have been now applied by over 6 lakh painters and contractors, across lakhs of residential sites, making it one of the largest contractor painter network in India."
Brand Salience & Top-of-Mind Recall – "Our independent research shows the consumer love for Birla Opus brand continued to rise as Birla Opus has become the number two brand in top of mind recall across India at the end of Q2FY'26. Such brand recall within 18 months of our launch and 12 months of pan-India operation is quite unheard of in the marketing world." — Himanshu Kapania

B2B E-Commerce (Birla Pivot) – Growth Acceleration & Milestone Achievement

Revenue Growth & FY'27 Target

"The platform has now added a diversified range of raw materials, including polymers, solvent, textile chemicals and nonferrous metals… Birla Pivot's expansion is well timed to capture this momentum, enabling smarter tech-enabled procurement. As digital penetrations remain below 2%, India's B2B ecommerce trade is on the cusp of a major shift." — Himanshu Kapania, MD

Current Performance (Q2 FY'26):

Revenue: Annualizing >INR6,000 crores (based on Q2 sequential growth of 15% despite monsoons)
YTD Growth: Sequential 15% QoQ growth momentum

FY'27 Target – Potential Early Achievement:

"There is a likely chance that we will get there and hit that milestone sooner." — Sandeep Komaravelly, CEO, Birla Pivot (responding to INR8,500 Cr FY'27 target)

Target	Value	Timeframe	Status
Revenue Scale	INR8,500 Crores (USD1 Billion)	FY'27	On track; likely early achievement
Market Opportunity	USD200 Billion	By 2030	Market tailwind
Digital Penetration Current	<2%	2025	Whitespace for expansion

Buyer Retention & Repeat Purchase Dynamics:

"All the buyers who we acquired last year, they've already purchased on an average more than twice the amount this year, giving us the confidence that whatever experience that we're delivering through both a combination of our assortment and our technology backbone is giving results." — Sandeep Komaravelly, CEO

Implication: Strong repeat purchase metrics (2x average purchase value YoY for cohort-acquired last year) indicate:

Product-market fit and customer satisfaction
Unit economics supporting customer acquisition and retention
Platform stickiness for B2B procurement (logistics, financing, assortment bundling)

Chemicals Business – Chlorine Integration & EBITDA Roadmap

CPVC & ECH Project Timeline & Contribution

"Two key projects, CPVC in partnership with Lubrizol and ECH remains on track. The mechanical completion is expected by Q3 FY '26. Post completion of ongoing projects, chlorine integration is expected to reach 70% compared to current 64%." — Hemant Kadel, CFO

"So that ECH and CPVC would be meaningfully contributing from Q1 of next financial year. We will be mechanical complete by Q3, worst case situation in January, but the start-up times of these plants are long and complicated." — Jayant Dhobley, Business Head, Chemicals

Project	Timeline	Contribution Expectation
CPVC & ECH	Mechanical completion by Q3 FY'26; Start-up into Q4 FY'26	Meaningful contribution Q1 FY'27 onward
Chlorine Integration	Post-completion	70% integration (vs. current 64%)

EBITDA Improvement Catalyst:

"I think the honest answer to that is it essentially depends on chloride, given our large exposure still to the chloralkali business. It's a combination of caustic prices and chlorine demand in India. That is the most meaningful factor that drives our results." — Jayant Dhobley

The next inflection in chemical EBITDA hinges on:

Caustic Soda Pricing – Currently supported by domestic demand and rupee depreciation; global CFR SEA prices down 5%
Chlorine Demand – Currently negative realizations; ECH/CPVC integration will unlock downstream value by converting negative-margin chlorine into specialty chemical products
Renewable Energy Integration – Target of 40% renewable penetration (vs. current 25%) over 3 years could reduce power costs by ₹3-5/kg caustic

Specialty Chemicals Growth – 34% Volume YoY

"Specialty Chemicals revenue contribution improved to 30% versus 26% in quarter 2 FY '25 driven by volume growth of 34% year-on-year due to stabilization of newer capacity." — Hemant Kadel, CFO

Specialty chemicals (higher-margin products) grew 34% volume YoY as new capacity stabilized, offsetting pressure from flat caustic volumes. This mix shift (30% specialty vs. 26% prior year) supports gradual EBITDA/tonne improvement despite commodity headwinds.

Cellulosic Fiber Business – Stability & Export Focus

CSF Utilization & Inventory Normalization

Current Status:

China Utilization: 89% (healthy operating levels)
Inventory Days: 15 days (normalized from prior highs)
Volume Trend: -5% YoY (logistics normalization driving recovery)

Lyocell Capacity Expansion – Mid-2027 Timeline

"The lyocell capacity expansion with the cellulosic fiber business is progressing as scheduled and remains on course for commissioning by mid-2027." — Hemant Kadel, CFO

This expansion supports long-term volume growth and specialty fiber mix improvement, critical given raw material cost headwinds limiting near-term margin expansion.

Q3 Outlook – Stability with Conditional Optimism

"We expect a slightly better performance in Q3. But obviously, there are a lot of ifs and buts in terms of U.S. tariffs, in terms of global pulp prices. We expect stability and a slightly better performance for Q3." — Vadiraj Kulkarni, Business Head, Cellulosic Fibre

Implication: Management expects modest Q3 improvement contingent on:

No escalation of U.S. tariffs on specialty fibers (geopolitical risk)
Stable global pulp prices (commodity headwind mitigation)

Capital Expenditure Program

FY'26 Capex Guidance

"Grasim has outlined a capex outlay of INR2,263 crores for FY '26, of which INR941 crores was deployed in first half of financial year '26." — Hemant Kadel, CFO

Metric	Amount	Allocation
Total FY'26 Capex	INR2,263 Crores	Full year guidance
H1 FY'26 Deployment	INR941 Crores	41.6% of annual guidance
H2 FY'26 Pipeline	~INR1,322 Crores	58.4% (implied)

Paints Business Capex Completion:

"The total capex spend for Paints business stood at INR9,727 crores as on 30th September 2025… With this plant's commercialization, the announced project phase of Decorative Paints concludes…" — Himanshu Kapania

Birla Opus has completed its announced capex phase with INR9,727 crores invested across six plants (1,332 ML capacity). Future capex for paints will focus on maintenance/debottlenecking rather than greenfield expansions.

Sustainability & ESG Initiatives

"Happy to share that Birla Cellulosic Fiber division of Grasim has received the highest rating of "Dark Green Shirt" in the Canopy's Hot Button Report for the sixth consecutive year, reflecting its focus on sustainability." — Hemant Kadel, CFO

The cellulosic fiber division's sustained "Dark Green" rating underscores commitment to sustainable forestry and water management—critical for brand positioning in premium decorative paints and specialty fibers markets.

5. COMPETITIVE LANDSCAPE & MARKET DYNAMICS

Decorative Paints Market Structure & Competitive Position

Industry Dynamics in Q2 FY'26:

*"As per internal estimates, the organized decorative paint industry has grown in low single digits on a Y-on-Y basis in quarter

Grasim Industries Ltd — Nov2025 Conference Call Summary