India’s PVC pipe manufacturers to post over 10% revenue growth in FY26: Report
New Delhi: India’s polyvinyl chloride (PVC) pipe and fittings manufacturing sector is expected to see a 10-11 per cent growth in revenue this fiscal, driven by strong demand from the end-user segment and a more stable price environment, a report said on Wednesday.
After a steady revenue growth in the previous fiscal, manufacturers are expected to see a recovery this fiscal, Crisil Ratings said in its latest report. This increase in demand is due to positive momentum in government schemes such as Jal Jeevan Mission, Pradhan Mantri Awas Yojana and other construction activities.
Himank Sharma, director, Crisil Ratings, said, “Demand for PVC pipes and fittings has remained strong in recent times due to government schemes such as Jal Jeevan Mission and Pradhan Mantri Awas Yojana, which are schemes focused on water supply, sanitation and housing sectors.”
This growth will reduce manufacturers’ high-cost inventory as dealers start re-stocking channels and partially offset the 130 basis points decline in operating margins in the previous fiscal. Improved profitability and reduced inventory levels will also reduce manufacturers’ working capital requirement and provide scope for capacity expansion without putting pressure on balance sheets, the report said.
According to the report, 16 PVC pipe manufacturers have indicated growth potential this fiscal, with cumulative revenues of over Rs 30,000 crore, accounting for two-thirds of organised sector revenues last fiscal. “Demand for irrigation and water supply projects, which contribute nearly three-fourths of sector revenues, remains strong given government incentives in these sectors,” the report said.
This fiscal, driven by demand and stable prices, production volumes are expected to grow rapidly, the report said. Higher production volumes will help manufacturers grow revenues by 10-11 per cent and increase operating rates, pushing operating margins to 13.5-14 per cent this fiscal.
“Further, improved demand will also lead to re-stocking by dealers and lower inventories with manufacturers by 8-10 days, thus curbing credit growth,” said Rushabh Borkar, associate director, Crisil Ratings.
