India’s building materials sector reported a mixed performance in the third quarter of FY26, as steady volume growth in pipes and wood panels offset continued weakness in tiles, while margins remained under pressure due to softer realisations and input cost headwinds.
Aggregate revenue for the building materials universe rose 15.8% year-on-year in the quarter, with EBITDA margins improving to around 11.4%. Net profit increased 8.3% from a year earlier. Volume growth was led by plastic pipes at 11.4% and MDF at 15.2%, while tiles posted a modest 1% increase.
Large organised players continued to prioritise market share gains over near-term profitability, intensifying competitive pressures across segments.
In pipes, demand improved sequentially, driven by resilient plumbing demand, though agricultural and infrastructure segments remained subdued. A sharp decline in PVC prices weighed on realisations and margins during the quarter. However, a recent rebound in PVC prices and supportive policy developments in China are expected to aid earnings recovery in the coming quarters. Companies such as Astral Limited and Supreme Industries outperformed on volumes and product mix.
The tiles segment continued to face headwinds amid weak retail demand and heightened competition from Morbi-based manufacturers. While project demand offered some support, it was insufficient to drive broad-based growth. A gradual recovery is anticipated from the fourth quarter onward, though the pace may lag other building material categories. Key listed players include Kajaria Ceramics.
In bathware, early signs of topline improvement were visible, though margins were impacted by higher brass costs and increased discounting in the project channel. Companies such as Cera Sanitaryware are expected to benefit as project completions accelerate and premiumisation gains traction.
Wood panels remained a bright spot, with robust demand across MDF and plywood supporting healthy volume growth despite persistent pricing pressure from elevated domestic capacity.
