Kriti Industries (India) Limited (NSE: KRITIIND), the Madhya Pradesh-based manufacturer transitions to positive EBITDA despite top-line pressure as lower material costs offset revenue declines; company records warrant forfeiture of 6.3 million units following non-payment.
Market Data (As of December 31, 2025)
- Current Stock Price: ₹81.06
- 52-Week High / Low: ₹179.00 / 72.42
- Market Capitalization: ₹4,271.54 million
- Valuation: The company is currently trading at a negative trailing P/E based on its net loss position.
The company reported a 35.3% year-on-year decline in operational income for the third quarter ended December 31, 2025, reaching ₹1,358 million. The company faced significant pressure on sales volumes, which fell 29% during the period.
Despite the contraction in scale, company achieved a positive EBITDA of ₹56 million, recovering from an EBITDA loss of ₹14 million in the prior-year period. The company continues to operate at a net loss, reporting a net loss of ₹5 million for the quarter, though this represents an improvement from the ₹109 million loss recorded in Q3-FY25. As of September 30, 2025, total equity stood at INR 2,181 million, with Net Debt to Equity at 0.36x.
Nine Month Performance
- Total Revenue: ₹4,456 million, down 23.8% from ₹5,844 million in 9M-FY25.
- EBITDA: ₹166 million, a 41.1% decline from ₹282 million in the previous year.
- Net Profit/Loss: Negative ₹29 million, compared to a loss of ₹6 million in 9M-FY25.
- EPS: negative ₹0.51.
Key Development
The primary driver of the revenue decline was a sharp reduction in sales volumes across all core segments, attributed largely to prolonged rainfall through October 2025. Additionally, the company disclosed the forfeiture of 6,369,000 share warrants. These warrants, originally part of a July 2024 preferential allotment at ₹158.50 per unit, were forfeited after holders failed to pay the remaining 75% balance by the January 26, 2026 deadline. This resulted in the forfeiture of ₹252.37 million in subscription and allotment money.
Investment Thesis (Bull vs. Bear)
Bull Thesis:
- EBITDA margins improved to 4.12% in Q3 FY ’26 from negative 0.67% a year ago, driven by reduced raw material costs and disciplined operational expense management.
- Finance costs declined by 45.8% year-on-year in the quarter to ₹32 million, reflecting improved working capital management.
- The company maintains a dominant position in Central India with a distribution network of over 490 dealers and is positioned to benefit from government infrastructure initiatives like the Pradhan Mantri Krishi Sinchai Yojana (PMKSY).
Bear Thesis:
- Company remains unprofitable on a net basis, with a cumulative 9M-FY26 loss of ₹29 million.
- Total sales volumes for the nine-month period fell to 45,052 MT from 54,206 MT a year prior.
- The forfeiture of nearly 6.4 million warrants suggests a lack of investor confidence in the conversion price of ₹158.50, which is significantly higher than the current market price.
- The company’s heavy reliance on the agriculture segment (79% of revenue) leaves it vulnerable to volatile weather patterns.
Product Highlights
Company operates through four primary segments: Agriculture, Building Products, Industrial Solutions, and Micro-Irrigation. The company’s portfolio includes RPVC, CPVC, and HDPE pipes, as well as specialized products like telecom ducts, gas pipes, and submersible casing pipes. Under its “Kasta” brand, the company is expanding its presence in the FTTx industry and industrial plumbing, targeting high-growth sectors such as HVAC and network infrastructure.
Business Outlook & Strategy
Management’s strategy focuses on maintaining its leadership as a single-location integrated fluid transmission provider with a total capacity of 1,49,400 TPA. Growth drivers include expanding the dealer network across 16 states and increasing the share of value-added products. The company aims to capitalize on the global CPVC market, which is projected to grow at a CAGR of 10.8% through 2030, by targeting urban infrastructure and building construction.
Sector & Macro Context
The global plastic pipe market is expected to grow at a CAGR of 6.8% from 2024 to 2030, supported by modern irrigation and water management needs. In India, the FTTx industry is driving demand for HDPE pipes, with the market expected to reach $233.5 million by 2026. However, the sector remains sensitive to raw material price fluctuations and domestic climate conditions, as evidenced by the volume impact of prolonged rains on company’s recent performance.