Century Plyboards (India) Ltd (NSE: CENTURYPLY) Q3 2026 Earnings Call dated Feb. 05, 2026
Corporate Participants:
Nikita Bansal
Keshav Bhajanka — Executive Director
Analysts:
Navin Agrawal — Analyst
Sanjay Agarwal — Analyst
Rahul Agarwal — Analyst
Balaji Vaidyanath Narayanan — Analyst
Rehan Sayed — Analyst
Sneha Talreja — Analyst
Bhavin Rupani — Analyst
Keshav Lahoti — Analyst
Presentation:
Keshav Bhajanka — Executive Director
Sa. Sat. Sa. Sa. Ladies and gentlemen, please stay connected. The call will begin in next few minutes. Thank you. Foreign. Ladies and gentlemen. Welcome to Century Plyboards India Limited’s Q3 FY26 earnings conference call. As a reminder, all participant lines will be in the listen only mode and there will be an opportunity for you to ask questions after the management’s opening remarks. Should you need assistance during the conference call, please signal an operator by pressing Star then zero on your touchstone phone. Please note that this conference is being recorded. I now hand the conference over to Mr. Naveen Agrawal Head, Institutional Equities, SKP Securities Ltd. Thank you. And over to you, sir.
Navin Agrawal — Analyst
Good afternoon ladies and gentlemen. I’m pleased to welcome you to this financial results conference call. On behalf of century plyboards and SKP securities. We have with us Mr. Sanjay Agarwat, M.D. and CEO Mr. Keshav Bajanka, Executive Director. Mrs. Nikita Bansal, Executive Director along with Mr. Arun Julasaria, CFO Mr. Novaran Sen, COO, Plywood Business. Mrs. Smartwaters CEO MDF and Particle Board Business and Mr. Vishu Goyal, CEO, Laminates Business. We’ll have the opening remarks from Mr. Sanjay Agarwal followed by a Q and A session. Thank you. And over to you, Mr. Agarwal.
Sanjay Agarwal — Analyst
Thank you, Naveen. Thank you. You are doing a wonderful job for us.
Navin Agrawal — Analyst
Thank you.
Sanjay Agarwal — Analyst
So good afternoon everyone and a very warm welcome to our Q3FY26 earning conference call. Before we begin, I would like to remind you that today’s discussion may contain forward looking statements which are subject to to risks and uncertainties. This call is not intended as a solicitation to invest. The financial results and investor presentation have already been shared and are available on the stock exchange websites. The company delivered a strong and broad based performance during the quarter with healthy growth across all key business segments. This performance highlights the structure strength of our business model, strong brand equity and the tangible benefits of our continuous efforts to improve productivity and operational efficiency.
Q3 is not directly comparable to Q2 as Q3 typically experiences softer demand relative to Q2 due to seasonality associated with festive period. At a consolidated level, the company recorded its quarterly revenue of 1350 crores representing a year on year growth of 18.4%. This growth was driven by sustained demand across product categories and robust performance from our newly commissioned units. On a nine month basis, FY26 revenue grew 17.3% year on year demonstrating our ability to sustain momentum despite a challenging macroeconomic environment. On the profitability front, we achieved our consolidated EBITDA excluding forex of 170.5 crores, the EBITDA margin ex forex improved to 12.6% compared to 10.7% in the corresponding quarter last year.
This improvement was driven by higher volumes, operating leverage and the benefits of our ongoing cost optimization initiatives. Overall, the quarter reflects not only strong growth but also a significant improvement in the quality of earnings. Segmental Performance Let me now walk you through the performance of our key business segments. Plywood Segment the plywood business achieved quarterly revenue of 710 crore with 14.9% year on year growth. This performance was supported by healthy volume growth and an expanded distribution reach. EBITDA margin stood at 15.1% supported by operating leverage and stable input costs. Laminate Segment the laminate division continued its improving trajectory reporting its quarterly revenue of 183 crore.
Revenue grew 9.6% year on year and 13% on nine month basis. EBITDA margin stood at 7.7% driven by better cost absorption and an improved product mix. Going forward, we expect steady improvement in both volumes and profitability as the business benefits from strong brand recall and enhanced manufacturing scale. MDF Segment the MDF business continued to deliver strong growth with revenue increasing 19.1% year on year. Growth was driven by higher volume and improved capacity utilization across plants. EBITDA margin stood at 12.1% compared to 10.7% in the corresponding quarter last year. Particle Board Segment with improved capacity utilization and higher sales volume, the segment achieved its highest ever quarterly sales of rupees 65 crores with EBITDA at breakeven.
Financial Overview From a financial perspective, Q3 reflects consistent improvement in both scale and earning quality. Our continued focus on operational excellence and disciplined capital allocation has enabled us to maintain healthy return ratios. We remain committed to investments in brand building, technology upgrades and distribution expansion to support long term growth. Looking ahead, we expect the growth momentum to continue across all major business segments. The medium term outlook for the building material and interior solutions industries remains positive supported by rising urbanization, increased disposable incomes and the growing preference for branded and premium products. With a diversified product portfolio, strong brand equity, an expanding distribution network and upcoming capacity additions, Century Flyboards is well positioned to deliver sustained growth in coming quarters.
We will continue to focus on value creation through operational efficiency, prudent financial management and responsible growth with shareholder return remaining central to our strategy. That concludes our management commentary. We will now open the floor for questions.
Questions and Answers:
operator
Thank you very much. We will now begin the question and answer session. Each participant is requested to limit themselves To a maximum of two questions. Time permitting we will respond to any further questions that you may have that remain unanswered. Anyone who wishes to ask a question may press star and one on the Touchstone telephone. If you wish to remove yourself from the question queue, you may press star and two participants are requested to use handsets while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. We’ll take a first question from the line of Rahul Agarwal from Ikigai Asset.
Please go ahead.
Sanjay Agarwal
Hi Rahul.
Rahul Agarwal
Hi sir. Good afternoon. Thank you so much for the opportunity.
Sanjay Agarwal
Yes sir.
Rahul Agarwal
Two questions. Firstly some bit of indication on how do you look at fiscal 27 across segments on growth and margins?
Sanjay Agarwal
That’s the first question. I think we haven’t published any numbers on FY27 yet. But when you look at FY26 we’ve had a very strong growth and it has been largely in line with headings. So I think FY27 is likely to look similar if not better.
Rahul Agarwal
Anything specific on the MDF side in terms of our growth, what kind of volume would you target or should it be similar?
Sanjay Agarwal
20% like you know our long term growth ambition is 12,000 crore by 531. So that includes an annual stagger of 18 plus. So next year also I think we’ll see a robust growth mdf. But for the time being till we don’t freeze up our numbers I can’t give guidance for the next year. Rahul, we are excited. We are excited about pictures.
Rahul Agarwal
Okay. And second question was on capacity just on plywood and mdf. I think we’re still to add some capacity on the existing plants. So wanted to know how much of that is left which will get computed in 27 and then you know on the up capex which you’ve announced for 1100 crores if you just run through your broader thoughts you know, in terms of how would these plants be better versus existing plants in case there is some efficiency or you know, different SKUs, how do you plan to source timber and you know, how do you plan to fund it? So these were the questions on capex.
Rahul Agarwal
Thank you.
Nikita Bansal
So should I first answer on the plywood capacity Keshav or you want.
Keshav Bhajanka
Sure, sure, sure, sure. Go ahead.
Nikita Bansal
Yeah. So on the plywood capacity throughout this year we’ve been doing internal expansion. So if you will see we’ve been from where we started this year we’ve been growing and in Q4 we will be at almost 4,30,000 CBM in this quarter because we’ve been doing expansion in Kandla, we’ve been doing expansion in Guwahati, we’ve been doing expansion in Joka. But next year we have two major expansions planned. One is our Hosharpur plant which is coming up. It should be operational in Q3 in the next financial year. And the other is that we are expanding our Chennai unit so that also should be operational by Q3 next year.
So I think with existing capacities expansions that we are doing we will be able to sustain H1 and in H2 we will have two additional capacities coming in. All these expansions are being done with a view of where we want to reach in five years. And even in UP which Keshav will elaborate more on. We also planning a plywood plant there. Out of the entire thing there would be about. We are planning 90,000 CBM eventually in UP but obviously we may start and gradually increase it to 90,000.
Nikita Bansal
So over to you just, just a sec on Chennai, what is the CBM capacity you’ll add?
Nikita Bansal
So currently we have done 60,000 in Hoshyarpur but we will start operations with 30,000 and minimum is 32,000 and then eventually increase it to 60. We put machines worth 60,000 but we will gradually increase it. And in terms of Chennai currently we are at it will be. It will be almost 1 lakh if I’m not wrong like in CBM I usually talk in NAS. So in CBM it should be 1 lakh. It’s little higher than the UP plant.
Rahul Agarwal
Thanks for that. Yeah. Yeah.
Nikita Bansal
And on the balance 1 lakh is not additional, it’s total.
Keshav Bhajanka
Yeah. On the MDS side I think we’ll be able to unlock a 70,000 cubic meters additional once we able to to extend the line. I think that will be within Q1 of the next financial year itself. And post that we will be via total capacity which will be around 65,000 cubic meters. As far as the Uttar Pradesh project is concerned that will have a MDF capacity of in excess of 3 lakh cubic meters again and the time horizon for that we would be estimating at about two and a half years from the date from which we have land demand.
Currently we are waiting for provers to actually get the land in our possession.
Rahul Agarwal
And how do you plan to fund it.
Keshav Bhajanka
Funding out? I think it is a dynamic scenario. Currently we have very strong internal accruals. So going forward as and when we finalize the funding plan we shall be back to you.
Rahul Agarwal
All right, perfect. Thank you so much. I’ll get back in the queue. Thank you. All the best.
Keshav Bhajanka
Thank you. We’ll take our next question from the line of Balaji Vaidyanath from Nafa Asset Managers Private Limited. Please go ahead.
Balaji Vaidyanath Narayanan
Good afternoon to the management.
Sanjay Agarwal
Hi, good afternoon. Good afternoon.
Balaji Vaidyanath Narayanan
Sirji. Just wanted to understand that this incremental capacity that’s been announced for MDF, the 330,000m3 entire thing is going to be in up. Is my understanding correct?
Keshav Bhajanka
Yes.
Balaji Vaidyanath Narayanan
Okay. So you know my sub question is, you know North India pricing was much better compared to South India as far as MDF is concerned. So now you know, with the capacity being added so we can expect cutthroat price war to commence in North India as well, you know, because if you see over the last say four to five years, if you look at all the listed companies, the entire capital employed in MDF segment is roughly 3500 crores including and today it is earning less than fixed deposit. So you know, with that in mind and with an 85% capacity increase that has been announced, are we seeing such a demand for MDF because you know it sector is weakening and of course that will have some kind of second third order impact on the housing demand etc.
So just wanted to understand this, you know, thought process in terms of this severe capacity expansion. So is MDF getting into a telecom industry like situation where you know there are three players and they went into a cutthroat pricing war for more than a decade. Looks like that can get replicated in MDF industry.
Keshav Bhajanka
So I think you asked a lot of questions in that but I’ll try to answer whichever I understood. The first thing is that you know it is not, it is not fair for us to comment on composite competition and their returns. But as far as we are concerned I think for the current year we are at a 24% growth trajectory and going forward we believe that MDF still has a lot of room to grow. For the current year we have guided for 25% plus growth and I think that we will be able to achieve that.
As far as, as far as the returns are concerned currently we are at a decent for the current quarter 12%. This is with a lower base because of the festive season and after certain flooding situation happened in Punjab which caused the highs of September. Going forward I think we are well online to achieve our aspiration of 15% EBITDA and then build on that. So with these two, with this 25% plus growth and a 15% plus EBITDA I think we are in reasonably healthy position.
Balaji Vaidyanath Narayanan
In a hypothetical situation, you know, we have seen, you know, the government of India actually reverting and going back on QCoS etc on a lot of product categories. Of course that’s not happened in mdf, but in a habitual situation, if that were to happen, then we are going to have one more player in the form of imports once again, you know, which is currently subdued. You know, any thoughts on that? If that has been factored in into this.
Keshav Bhajanka
Currently, the pricing that is there, if you look at it, imports even earlier never constituted more than 78% of the total sales of MDS in the country. And having said that, the prices, like you rightly said, because of the intense competition that has taken place because of unprecedented capacity addition over the course of the last two years, which is unlikely to be repeated in the foreseeable future, prices are actually bottomed out. I don’t see that as much of a challenge. However, having said that, I think BIS is here to stay. The Indian consumer deserves a good product and the government of India has ensured that happens.
I don’t think they’re going to walk back from that.
Sanjay Agarwal
Let me explain a little bit. You see, in, in next five years our chairman said that in next five years or say 10 years, lot of capacity of MDF will come in India. You believe that in 10 years, do you believe that definitely that in 10 years there will be lot of capacity addition, Isn’t it correct? Yes. So if there will be capacity addition, there are two ways. Either new players will come or if the existing players come in advance, new players will be deterred, they will not come. So there will be a. There may be a fight of little bit, some for some time or we believe that we will get a period of say year or two year in between where we will be making more money.
But otherwise, yes, every two year or so there will be a fight for two, three years and again two years will be nice. But ultimately the capacity addition will be done by just one or two or three players. That’s a good thing to happen for an industry. So that is the. If you look at steel industry, it’s not passing through a good phase, but lot of addition is coming. Cement industry, lot of addition of capacity is coming and lot of capacity is unutilized. But still everybody makes some profit. So that is how it’s going to be in the MDF industry also.
And MDF is a growing industry. It’s growing at 20% per annum. It has shown that it has the possibility. So and even then the Plywood is also growing. We have a projection that next year 5 to 7, 7% increase will be there in plywood growth will be there. So we believe that yes, all this will help the company to grow in long term. In short term there may be issues which nobody can deny and that could be there in any industry. If you look at short term, you cannot plan. We are planning for next 50 years.
I hope I’ve been able to make you clear. Yeah, yeah.
Keshav Bhajanka
Thank you so much. Just one last thing is Keshavji mentioned that you know, prices have kind of bottome. If, if you could throw some light on, you know, whether you know, it’s referred, referred to South India or North India or you know, both put together.
Sanjay Agarwal
You see why we say prices have bottomed. There is only one reason the prices are not going down. Nobody is talking. There is nothing happening in the market and still we are selling and there is an ebitda. So that itself is the proof that the prices have bottomed. Capacities are still unutilized in certain many manufacturers. So that means prices have bottomed. They will not go down further. And we really expect the prices to go up actually a little bit and the raw material prices will go down. Because the plantation which has happened across.
Sanjay Agarwal
The country, we have done very elaborate. Survey across all fields. Lot of plantation has happened. The prices of raw material has to go down. Nobody can stop that. Yeah. It’s taking its own time. That’s the reality. Because it takes time to grow.
Balaji Vaidyanath Narayanan
Thank you Sanjay. Thank you Keshavi. Wish you all the best.
Sanjay Agarwal
Thank you.
Keshav Bhajanka
Thank you. Next question is from the line of Rehan Sayed from Trinetra Asset Managers. Please go ahead.
Rehan Sayed
Yeah, good afternoon.
Keshav Bhajanka
I’m sorry to interrupt. Can you use your handset mode please?
Rehan Sayed
Yeah, sure. Just give me a minute. Is it here now?
Keshav Bhajanka
Yes, please go ahead.
Rehan Sayed
Yeah, so sir, my first question is around. I want to just understanding regarding your, your guidance that you have given regarding MDF margin. So the for the current 9 month EBITA margin x forex for MDF stands at 13.4% and your FY20, 2026 guidance target at a higher 14, 14% range. WHO with the quarter C margin coming in at 12.1% year have rightly put that it’s the cause of softening demand in quarter C. So what specific triggers such as raw material softening or a higher capacity utilization from the new and plant will reach this capital?
Keshav Bhajanka
So I think we are looking at a higher margin in the current quarter because of two things. Firstly like I mentioned there Was a flooding situation in Punjab in the last quarter that led to slightly higher prices for north plant which is now eased out. Secondly, we will be looking at the higher capacity utilization in the current quarter. Q4 is traditionally always better in Q3 as far as demand is concerned. So I think that these are going to help us look at slightly higher margins for the quarter. Lastly, chemical prices have also stabilized and I think that is also going to aid in the pursuit of higher margins.
Rehan Sayed
Could you please repeat last time what you have said?
Keshav Bhajanka
Chemical prices have also stabilized and this is also likely to aid margins.
Rehan Sayed
Okay. And my second question is around. Just want an understanding regarding your CFS segment volatility. So the CFS segment saw a 43.3% YoY revenue jump this quarter. So. But EBITDA margin X Forex dropped to 18.8% from 19.9% in the same period last year. So could you explain the cost pressures or change in the service mix that led to this margin contract despite the higher output?
Sanjay Agarwal
You have case of some idea you can use is regarding cfs. Now you have some idea you can explain or otherwise we will explain later. So please note down then the name. We will call you later on to explain.
Rehan Sayed
Sure. I have only the question. I will come back and back.
Keshav Bhajanka
Rehan, you’re through with your question, right?
Rehan Sayed
Yeah, I am done with my question. Can I repeat my question again?
Sanjay Agarwal
No, they will call you. This is regarding CFS now.
Rehan Sayed
Yeah, CFS segment.
Sanjay Agarwal
Yeah, yeah. So CFS actually we are not updated very much. Very frankly I should be but really I’m not updated right now. So we will call you our investor lessons. Vinay will call you and update you.
Rehan Sayed
Sure. Okay.
Sanjay Agarwal
Yeah. Okay. Yes, thank you.
Keshav Bhajanka
We’ll take our next question from the line of Sneha Talreja from Nuama. Please go ahead.
Sneha Talreja
Hi, good afternoon team and congratulations.
Sanjay Agarwal
Yeah, thank you.
Sneha Talreja
Just couple of questions now. Firstly on the laminates front you know we are seeing a lot of product mix changes there. While we don’t see volumes have you know gone down by 7%, 15% beauty. We’ve seen a huge jump in your average realization. And you know margins are also, you know sequentially, you know, slightly improving. So what is the outlook and how do we read this segment and you know how do we see the growth in this particular segment coming in?
Keshav Bhajanka
As we have discussed earlier as well in London, we are confident of a 15 plus growth of the year. And I think that this is based on both domestic as well as export demand. As far as the export market is concerned. It is larger sizes and because it is larger sizes the per unit realization will always be higher. So that could be the reason for the ASP drop. Having said that, domestic is also likely to start firing again from Q4 itself or from early next year. A combination of both. We are looking at 20% growth for next financial year.
Sneha Talreja
I understand that was quite helpful. And what sort of margins? Because we are currently seeing margins hovering around 9 odd percent which only it used to be double digit of around 14 to 15 odd percent double digit.
Keshav Bhajanka
Margins next year for sure.
Sneha Talreja
Second question was what’s the magic which is happening in plywood segment? You know, constantly seeing 15% plus growth. What I basically want to understand is you know what would be the industry level growth at this point of time. I know our industry numbers are very difficult to find but you know how much of market share increase people have seen in last two years and how much is the furthest hope to see that kind of an increase happening? Like how confident are we to continue the 15 and for a harmony. Hi. So the thing is with respect to plywood, the industry feel like you said, it is very difficult but from whatever study that we keep doing it’s somewhere between 6 to 7% is the plywood industry growth.
So it is not that the industry is not growing because of other products etc. So industry is growing, we are growing better because we are obviously our endeavor has to be to increase our market share. And where we look at it I believe is that today at an industry level we are actually in the last two years or rather I would say before COVID we were at 4%, 4 and a half percent. Today I don’t know what we are today at the end of this year but I know what we were last year. We were at around.
These are all estimates we around eight, eight and a half percent. So we’ve doubled and more in the last since pre Covid to now. Where is my. Where do we want to take it? We obviously want to double it more. We are doing everything we can. I think that’s the vision that we are working towards. So I think it’s not magic. I think it’s a lot of hard work and a lot of focus towards this that is delivering these numbers. We definitely have confidence that we will do everything unless and until something really drastic happens in the market which is not predictable.
But we will put in our 120%.
Sanjay Agarwal
Let me chip in cneha a little bit. You we have told earlier that we keep on doing something new, some new experiments are always on and we actually fail more then we succeed. But out of the five experiments, even if one succeeds then it gives us the the growth we are looking at. Because with the old systems nothing can be gained in today’s type of economy Today chat GPT has become the most important thing for everybody. Everybody goes to chat GPT five times a day now before going to a doctor actually you know all the details about whatever you have.
So we have succeeded like that and.
Sanjay Agarwal
For future also we are quite excited. Because there are too many things happening and there are too many possibilities. Now earlier it was dealer Kholo Banalo but there are too many possibilities now we are keeping on doing new new experiments. Some of them succeed and that is what gives us this kind of a success. And another thing I will tell you right now the division of plywood is in a momentum, good momentum. So that momentum is also helping us.
Sneha Talreja
And that was great. Thanks team for that. Just lastly on the MDF front now we’ve again put up a new capacity. When is the hope that we have in current capacities we’ll see margin revival or industry will actually see margin revival because of these capacities like I think every other participant we are really concerned on the roti front. So which particular quarter is the one where you see turnaround happening in realizations and margins?
Keshav Bhajanka
Although you know we are not fortune tellers. However I think that going forward margin recovery is definitely on the cards. The reason, like you have rightly pointed out, there’s a lot of capacity has been added but the way the capacity added was added in the last couple of years, I don’t think that is likely to sustain. New capacity additions have slowed down and going forward with 20% plus CAGR as far as the demand scenario or demand growth is the equilibrium should be reached maybe also go so next year, year and a half. So during this time period you should see margin recovery.
Exactly which month, which quarter, which week is difficult to predict.
Sneha Talreja
Thanks, thanks for your team and all the best.
Keshav Bhajanka
Thank you.
Sanjay Agarwal
Thank you. Thank you.
Keshav Bhajanka
We’ll take our next question from the line of Bhavin Rupani from Investec. Please go ahead.
Bhavin Rupani
Yeah, good afternoon sir and thanks for the. Yeah, yeah.
Sanjay Agarwal
Hi.
Bhavin Rupani
Hi sir. Sir question related to MDF. So our capacity is on FY25 annual report it says 6 lakh 27,000 CBM whereas our press release we have released Yesterday it says 561. So how should one reconcile that?
Keshav Bhajanka
So basically the capacity expansion that we were likely to do or that we will be doing in Q1 that was likely to take place in the current year. However, due to robust demand we have been unable to take that expansion. So we are adding close to 70,000 cubic meters of capacity. And that expansion will most likely happen in Q1 of next year. So this discrepancy is due to that?
Bhavin Rupani
Sir. And this is at our south plant?
Keshav Bhajanka
Yes. So in Budwell our current line is 28.8 meters. And we are going to be moving to 33.8 meter line with the 5 meter extension. So that will be happening Q1 of next year.
Bhavin Rupani
All right. Next is on our existing expansion. So first of all wanted to understand what is the rationale behind this Uttar Pradesh expansion. Are there any other players in this region as well? And also wanted to understand on the raw mat availability and proximity at this plant.
Keshav Bhajanka
Is the largest and most perennial source of raw material as far as most of India is concerned. Exceptional priest. And currently there are no MDF plants that are located within Uttar Pradesh. So it’s a huge market opportunity. And in line with the same, we are putting up a plant there. And we will update you as and when we acquired the land and post that within next two to two and a half years be in a position to set up a unit.
Bhavin Rupani
All right. And in case of this MDF plant, what is our machine make?
Keshav Bhajanka
We are yet to decide.
Rehan Sayed
All right. If you can just elaborate on what would be the capex outlay if we choose between Chinese or European. So how. How big is the difference percentage terms?
Keshav Bhajanka
It is not a very big difference. Because you are talking about the main press. The main Press contributes about 20% of total project cost. So in that there could be a delta of 15%.
Bhavin Rupani
Fair enough. Okay. And so on this plywood. So we have committed almost 330 crores for 90,000 CBM of expansion for Uttar Pradesh. So if we’ll just look at the capex intensity of this plant it is far higher versus our MDF plant. So how should I understand this? So what is the reason behind this?
operator
Sorry, can you repeat your question?
Bhavin Rupani
Capex intensity per CBM for our plywood plant is higher.
Nikita Bansal
It is actually 1 lakh 20 CBM because we are doing 1 lakh NA. So it is 1 lakh 20 CBM and not 90,000 CBM.
Bhavin Rupani
Okay. Even if we do 1 lakh 20,000 it comes to some around 27,000 rupees per CBM which is higher versus what we have announced in Uttar Pradesh which is 25,000 rupees for CBM.
Nikita Bansal
Sorry, I didn’t get it. I’m talking about Uttar Pradesh only.
Bhavin Rupani
Yeah. So if you look at our capacity, plywood capacity that we have announced In Uttar Pradesh, 1 lakh 20 against are doing capex of 330 crore. 330, right.
Nikita Bansal
Yeah.
Bhavin Rupani
Right. So per CBM it is somewhere around 27,000 rupees, right?
Nikita Bansal
Yeah.
Bhavin Rupani
Right. And if we Compare it with MDF for three 30,000 CBM we are putting. We are doing extensions of 800 crores. Which means per CBM it is 25,000 rupees. So how come our plywood plant is more expensive versus MDF?
Sanjay Agarwal
I think different capacities you are comparing to the 25, 27,000. But.
Keshav Bhajanka
You see in Thai wood, whenever we come up with a capacity, we create a capacity for a larger size. Currently all the brownfield expansions that you have been seeing which are nominal cost, they are because the infrastructure has been created. What we need to add on is debottlenecking equipment. So the shed, the peeling etc. Is ready. And what we add on is normally a hot press and a dryer. By doing this going forward future capex becomes much cheaper. So any new plant does have a certain higher capex when it is being established. However, going forward this plant can actually ramp up to a much higher capacity than what is currently being shown.
I hope that answers the question.
Bhavin Rupani
Right. And what would be our brownfield optionality over here at Uttar Pradesh after both these expansion of MDF and plywood.
Keshav Bhajanka
For. Mdf it would be difficult to expand further. You definitely be able to scale the unit up.
Bhavin Rupani
Would it be possible for you to put any numbers over here?
Keshav Bhajanka
No, currently it would not. But if you look at the history of other units you will get a semblance of this.
Bhavin Rupani
Perfect. And so just last one question. On mdf we have seen margin decline both year on year and QoQ in Q3. How should one understand the reason behind it?
Keshav Bhajanka
I think there’s not a margin decline year on year. You see there was a forex impact. Last year we had a positive forex fluctuation. This year we have had a slight forex loss. If you look at it with adjusted without forex this year at 12.1%. Last year, same quarter we had 10.7%. So you’re absolutely right. Quarter and quarter is slightly lower. The predominant reason for this is because of slightly lower operating leverage as well as flood situation in Punjab which I breezed about. Going forward, we are hoping that with better operating average, with better capacity utilization, we should have a stronger quarter.
Bhavin Rupani
All right. Perfect sir. Thank you so much.
operator
Thank you. Before we take the next question. Would like to remind participants to ask a question. Please press star N1 on your phone. Next question is from the line of Keshav Lahoti from HDFC Securities. Please go ahead.
Keshav Lahoti
Hi. Thank you for the opportunity.
Sanjay Agarwal
Yeah. Hi.
Keshav Lahoti
I want to understand on. First thing I want to understand on this function if I understood correct is a 60,000 cbm expansion. Out of that 30,000 cbm will come in Q3FY27 and balance when it will be coming. And secondly the Chennai expansion which company highlighted what is the capex size of that and what is the size of the expansion imply.
Nikita Bansal
So the thing is there’s one thing I should tell you all that we are now Once these new expansions come in we are planning to. Today we outsource scenic Mr. Which is our water resistant scenic plywood which is about. I would say 20% of our 8% of our overall plywood revenue is 10 Mr. Or whatever we outsource. So we are now planning to make it in house in say the next one year’s time. For that we need additional capacity because of which you are going to be finding that the capacity expansion is quite massive that we are doing in the next one year compared to what we’ve done in the past.
Having said that see with Kushyarpur we will start with 30,000. It is very difficult right now for me to say how and when we will reach 60,000 full capacity. It may take one year, it may take two years. But we are planning to start with 30,000. It will make the plant will be viable with that 30,000 as well. Because 30,000 to 60,000 there is very. There’s only two machinery that we need to add additional. It’s not a very heavy. It’s just a very less capex cost that we actually add into. And as far as Chennai and up goes Chennai capex.
I think Vinay can get back to you. I don’t have it in memory right now. Total capex that we are doing. And is there any other question I’ve missed answering?
Keshav Lahoti
Chennai is a 1 lakh CBM expansion by Q3FY27. Right?
Nikita Bansal
Actually that time I got the CBM calculations wrong. It will not be 1 lakh. It will be actually 1 second. No, it will be more. 1 lakh 25. 1 lakh 25 thousand into cbm. 1 lakh 50 thousand cbm. Hello.
Keshav Lahoti
Yeah. So Chennai is 1 lakh 50,000 CBM new capacity coming in Q3FY27 total.
Nikita Bansal
Total. We already at 75 or 80 000. We are taking it to 1 lakh system. Yeah.
Keshav Lahoti
Understood. Got it. One bookkeeping question on MDF side. What is the AP plant capacity right now? The current capacity For Andhra is 2 lakh 47000 cubic meters to 3 lakh 15 post the extension. The reason I am asking because if I understand right Kushyarpur is 313. If Andhra is 214. So your total capacity right now is 527 kcbm while prestige not 240. 247. 247. Got it.
Keshav Bhajanka
2.47 lakhs. Understood. And one last question. This particle board margin will be 15. When are we expecting this to reach? And what is the normalized margin of MDF industry in your view? In my view over any 3 to 5 year horizon period we would have looked at 25% margin for MDF. However considering the current challenging demand scenario I would say that a normalized return on MDF would be closer to 20% EBITDA alongside that for particle board I think maybe by Q4 of next year we should be able to target steady state margins. Okay, that is helpful.
Thank you so much.
operator
Thank you. Ladies and gentlemen, to ask a question please press star n1 on your phone. Now. Participants who wish to ask a question may please press star and one on their phone. We have a follow up question from the line of Rahul Agarwal from Ikigai Asset. Please go ahead.
Rahul Agarwal
Yeah. Thank you for the follow up.
Sanjay Agarwal
Just one.
Rahul Agarwal
One question on the capital expenditure side right? From a cash outflow perspective could you help us just understand how much would you. You know I think fiscal 26 is going to be about 400 crores. So if you clarify if this is correct and then 27:28 how are you going to spend this this capex? Could you just help us understand that? Thank you.
Keshav Bhajanka
It depends on when we get the land allotment. Once we have the same we will be taking more detailed view of how this expenditure will play out and we can share details directly. Till we don’t have land in hand it’s very difficult to give you any sort of a pickup.
Sanjay Agarwal
This land we have been trying for a long time now. It seems that yes, we will be able to get it but until the land is there we are not putting our minds into the how to how will we manage the funding. But certainly if the funding is not managed nothing will happen. So it will be. Certainly we’ll plan it but it will take some more time.
Rahul Agarwal
Right? Can I say bulk of the capex will happen in fiscal 28. Is that fair to. Fair statement.
Keshav Bhajanka
Again, Raul, it is not correct for us to comment on this at this point in time. Once we have, we shall give you the same.
Rahul Agarwal
Sure, I understand that. All right. Thank you so much.
Sanjay Agarwal
Thank you. Thank you, Rahul. Yeah.
operator
Thank you. Participants who wish to ask a question are requested to press star and one on their phone now.
Sanjay Agarwal
So I think.
operator
As there are no further questions, I would now like to hand the conference over to Mr. Sanjay Agarwal for closing remarks. Over to you, sir.
Sanjay Agarwal
Thank you. Thank you. Thank you, everyone for your insightful questions and continued interest in the company. We are encouraged by the strong performance across our business segments and remain confident about sustaining this growth momentum in the coming quarters. We appreciate your trust and support and we look forward to engaging with you again after our next quarterly results. Thank you. Have a great day.
operator
Thank you very much on behalf of SKP securities limited. That concludes this conference. Thank you for joining us. Ladies and gentlemen. You may now disconnect your lines. Thank you.
Sanjay Agarwal
Thank you. Thank you. Thank you. SKP also. Sam.