Somany Ceramics Limited (NSE: SOMANYCERA) Q1 2026 Earnings Call dated Aug. 14, 2025
Corporate Participants:
Unidentified Speaker
Abhishek Somany — Chief Executive Officer
Sailesh Raj Kedawat — Chief Financial Officer
Kumar Sunit — Head, Strategy & Investor Relations
Analysts:
Unidentified Participant
Sagnik Sarkar — Analyst
Pranav Mehta — Analyst
Neha Talrej — Analyst
Rehan Syed — Analyst
Lokesh Maru — Analyst
Udit Gajiwala — Analyst
Anubhav Goel — Analyst
Keshav Lahoti — Analyst
Utkarsh Nopany — Analyst
Presentation:
operator
Ladies and gentlemen, good day and welcome to the Somani Ceramics Limited’s Q1FY26 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 presentation concludes. Should you need assistance during this conference call, please signal an operator by pressing Star then zero on your touchtone phone. Please note that this conference is being recorded. I now hand the conference over to Mr. Sagnik Sarkar from SKP Securities Limited. Thank you. And over to you, sir.
Sagnik Sarkar — Analyst
Thank you. Good morning ladies and gentlemen. It’s my pleasure to welcome you all behalf of Somani Ceramics Limited and SKP securities to this Q1FY26 financial results conference call. We have with us Mr. Abhishek Somani, MD and CEO, Mr. Shailesh Rajke Dawat. CFO and Mr. Kumar Suneet, Head Strategy and IR. We’ll have the opening remarks from Mr. Somani followed by the Q and A session. Thank you. And over to you, Abhishek Ji.
Abhishek Somany — Chief Executive Officer
Yeah. Thank you so much. Good morning, ladies and gentlemen. Welcome to the Q1FY26 earnings call. As you have all seen the results already there’s been a muted demand on account of lower sales in India. And also there’s a little bit of pressure on lower exports from Norby to various parts of the world. In Q1 exports declined to 18,000 crores last year. And I think this year it would be a further decline. A couple of thousand crores is what the current trend is showing. Our sales grew by 4% and by volume 3%. I must make a point here that there is specific sale of Nepal which adds about 1.2% in Nepal.
We have come to an agreement where knowing to the specific laws of Nepal we will be getting this sale profit only towards the end of the year. But the sale does not get counted because it’s traded goods. And Nepal doesn’t allow to consolidate in these sales in Somali. So if I had to account for that Apple to Apple, it would be about another 1.2% growth of sales. Operating margin is marginally impacted due to low capacity utilization. Gross margin increased by 3.2% in Q1 quarter on quarter and it declined 1.8%. Y O yes, largely I would think it is flat.
JVs were the places where we had the maximum pressure on a stand alone. We did reasonably okay. Although the standalone capacity utilization was also low at 72%. Whereas the consol capacity utilization reduced from 81 to 77. There were three plants which were underutilized. One was the max plant which is the high end tiles. We have been extremely patient to make sure that that plant only produces high end tiles currently. So some other corrective action has been taken to further improve the capacity utilization this quarter. And it’s already showing some signs that by age two this would be much better than what it is in age 1.
On the sanitary ware front there was a major kiln shutdown that is back to 100% capacity as we speak. But in the first quarter it was impacted which was a situation where we had to completely shut down that to repair it completely. It will also yield us better quality and a little better yield and it’s back to 100% capacity. So second quarter should be very good from that point of view. For sanitary well the depreciation impact was approximately 5 crore rupees in Q1 compared to Q1 25. This is on account of reduction of life of some assets.
So an accelerated depreciation. So once again the capacity utilization at 77% sales at 601. Correspondingly you have seen the EBITDA. The EBITDA basically gets impacted. I’ve said it earlier also on capacity utilization. So this capacity utilization we’ve taken, we’re taking a lot of measures to make sure the capacity utilization is up and running by this quarter a little better. And also H2 would be further times better than what it is today as far as the tile segment revenue is concerned. Ceramic consisted of 34% down 1% from last year. Same quarter yoy pvt is at 26% down 2% and gvt is up to 40% up from 37%.
Gas prices are pretty much in line. Branch trends will be in line of with last year plus or minus a couple of crores working capital has marginally increased by four days. Net dealer addition has been approximately 65 dealers in this quarter. Our guidance, we’re not changing the guidance. We’re still guiding for high single digit growth and EBITDA expansion of about a percent percent and a half. And we are very very confident of the EBITDA expansion if we have better capacity utilization. And that is something which we’ve taken very concentrated steps to make sure that goes through.
The other tail endpoint this quarter has been that we have concluded the JV with Durabuilt that is a starting go to market will be next month. We’re concentrating on all the waterproofing products currently and then we will move to other patents and other IPs which DuraBuild has to offer. We are extremely hopeful and very excited for that new venture. It’s a much better margin business. But of course while we build out the business there will be certain pressures in the year one and year two. But it’s a very, very exciting business of construction chemicals. So extremely excited on those fronts.
These are the tail end points as far as Q1 is concerned. Q2 is already looking slightly better, although there’s been incessant rains across north. But still it is slightly better than last year. July was August is yet to be seen. It’s early days in August. So let’s see how that goes. We’re very hopeful. September should be a great month. This is it from myself and I would then open the floor to question Q and A please. Thank you so much.
Questions and Answers:
operator
Thank you very much. We will now begin the question and answer session. Each participant is requested to limit himself herself to a maximum of two questions. Time permitting we shall reward for any further questions that you may have which remain unanswered. Anyone who wishes to ask a question may press star and one on their touchphone telephone. If you wish to remove yourself from the question queue, you may press star and 2. Participants are requested to use handsets with while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles.
The first question is from the line of Pranav Mehta from Equerious Securities. Please go ahead.
Pranav Mehta
Yeah. Good morning team. Thank you for taking the question. Good morning sir. I just wanted to understand since you have touched on briefly, but if you can elaborate more on this durable acquisition and how we are seeing things.
Abhishek Somany
The first few sentences I couldn’t get. Can you please repeat?
Pranav Mehta
Yes, sir. So I wanted to understand on the durable acquisition so you have touched upon briefly, but if you can elaborate more on what is the strategy for this going forward and how it will be, let’s say contributing to the top line and the margins by FY27 and 28.
Abhishek Somany
Yes. So early days to talk on the top line and the margins currently because it just happens obviously the strategy is in place where we are not going to lose money. But just to give you a brief dura build has about 150 different IPs. We bought it for the IPs. You already know what the acquisition size is. Over the next three years we have the option of buying it completely. But we will move up to 75% and then maybe 100% by that time there is still in the game for the current partner to maybe earn out more while he sells the 100% within three to four years.
Specifically we are getting into construction chemicals out of the 100 IPs. We are concentrating on the waterproofing piece, the waterproofing market as what we estimate. Obviously we’re not in the market, so we have not 100% data, but we have 90% strong data. The market which we are trying to focus, it is approximately 6,000 crores and we are currently at ground zero right now. So that is a market which we are trying to get. And he has IPS of waterproofing material which is literally starting from the waterproofing which goes into the concrete while the house is being built or the building is being built, right up to the bathroom and the wet areas and the terraces.
And also waterproofing for the wall in case there are leakages in the wall or cracks in the wall. So it’s called a crack proof. Pretty much all these products are available with industry leader Pidlite and various other players like Sika Fosrock, mapei, Asian paints, etc. So that’s the segment which we are looking into. There is also another segment which we are thinking of getting into which is admixtures. Because in the concrete the admixtures for residential and building products and this is not infrastructure, this is only for residential and commercial buildings. Admixture, that’s another market of approximately 6000 crores which goes into as an additive on the site or in with RMC plants.
So we are gunning for currently an 11,000 crore rupee, 12,000 crore rupee market. And both of those we are virtually at ground zero. This particular company was only selling approximately a couple of crore rupees of day sales and about 7,8 crore rupees of admixtures. So admixtures is a B2B and the waterproofing business is both B2B and B2C. We are going to leverage our dealership and there are certain dealers who are dealing with these kind of products. We’re going to attract some of our larger distributors also to see if they want to start this business with us.
Plus we will be also getting into certain hardware shops and certain other specific waterproofing and admixture waterproofing stores. The stores like paint stores, various hardware stores. But we did a little bit of a dipstick in a lot of our dealership. Not a very significant amount, but a good 10, 15% of our dealership also is now been dealing into waterproofing for some time. So that’s the business we’re getting into we are currently doing all the packaging and all the go to market. We should be ready to go to market in B2B B2C for waterproofing towards the end of September.
Pranav Mehta
Okay sir, my next question was on this. So as you rightly mentioned that the demand continues to remain relatively challenging and let’s assume this year also the exports continue to face challenges. Then do you think that in the industry the receivable part and the realization on the realization part the. Or do you feel that still some competitive intensity might increase from Mobi’s end?
Abhishek Somany
No, I think the realization part is not going down. If you see our realization also it’s down a couple of rupees. But that’s not because of price decrease, that’s because of the product mix. Although we continue to make sure that we sell higher product mix. But in Q1 generally it is a situation where some low product mix also so and some second quality material, some old delete items, we’ve sold a lot of that and therefore the reduction. But from a price front, in fact we’ve taken a small price increase in July but there’s been no further price decrease.
So to say Apple to Apple as far as export is concerned, current trends are showing that it will be in that same 17,18,000 rupee. 18,000 crore rupee range. But the kind of quality which is being compromised from Murbi is really not competing with us anymore. And frankly Murbi is only surviving. Most of the Murbi brands, I obviously don’t mean the industry leaders from Murbi but 95% of the brands in Murbi are only surviving because of extremely high scale evasion of taxes of GST. And that has also reached a peak where there is no further scope to evade taxes.
I mean they’re already billing at 1011 rupees a square feet.
Pranav Mehta
Okay sir. And sir, on the receivable part for the industry, more or less.
Abhishek Somany
Sorry, I’ll tell you about that. The receivable part, thankfully for us we’ve gone down on receivables by a day. We are absolutely on the ball there and not losing focus. So touch wood, receivable as far as we are concerned is only better than what it was last year. While it is a pressured market and we are not seeing any further changes there or any further movement there. So even in July and August we are absolutely on the ball.
Pranav Mehta
Sure. Thank you very much.
operator
Thank you. Our next question is from the line of Neha Talreja from Nuama. Please go ahead.
Neha Talrej
Good morning. Team and thanks a lot for the opportunity. Just couple of questions from my end. Just wanted to deep dive into the current demand scenario in the domestic market and any improvement that you are seeing in the export market also because that will define the computer intensity from Maldi based players. So firstly from that front.
Abhishek Somany
So Sriya, demand hasn’t further gone down, it’s under pressure. We have grown even in July we’ve grown. So from that perspective I wouldn’t say that demand is further muted in India. Yes, there’s a little bit of pressure because of especially in the value added segment where the scope of tax evasion is that much higher. That’s the only one which is a little bit under pressure. But we are holding prices, we will increase prices a little bit and we are also holding on our receivables. So from that point of view this is the domestic demand as far as export is concerned.
We don’t export a hell of a lot. However our export will probably go up by 10 12% because our base is low. But overall export will be lower is what the trend is showing. But one never knows in export there is those couple of months which do cover up. Even if you see last year till H1 the trajectory was showing that it would be only about 15,000 crores when it made up and finally it touched about 18,000 crores. So that’s where the export is. It’s not picked up. But has it gone down further? Very slightly, not a very large amount but the trend is showing that it’s not going to be more than 16, 16, 17,000.
But I’m the wrong person to ask for export. Probably your channel checks in Morbi would give you a better idea on export.
Neha Talrej
Secondly sir, I mean the peer is you know into another level of cost cutting measures that they are taking. So just wanted to understand two to three things from you. Are you following any of those cost measures along with the leader? That’s first, do you see any implication of those cost cutting measures coming to you in the form of maybe, you know, some absence cartons and some market share gains. So some of these aspects in case you can, you know touch upon that will be really helpful.
Abhishek Somany
Yeah, I can’t comment on that strategy but as far as we are concerned we didn’t had, we didn’t have such costs. We had a single person at the top with all the vertical heads working. We don’t want to change that. We don’t have separate divisions other than at the corporate level where there are separate vertical heads for GVT PVT Ceramics. The only other team which we have which is working separately independently is our sanitiware team. But that’s been there since inception of Sanityware. And now the adhesive team, which is separate, but it’s already been separate since inception.
So we didn’t have any large cost. But yes, when going is tough then in legacy companies there are certain costs which you look at even more carefully. So if you’ve seen our employee cost, my employee cost has remained the same. Our increments have been. We have given increments, unlike some of the people who have given non increments, we have given increments, but we’ve been very, very cautious of that. And Touchboard, our team also has been very, very cooperative on that front. If you would see that this year we should be able to reduce, if we grow in the humble digits also and not the high single digits, even then we will be able to reduce our employee cost as a percentage of revenue by a percent.
So we’re very careful on that account. As far as the other costs are concerned. In terms of advertising, which is the other big one, the advertising cost, we are not reducing, but we are maintaining. So as a percentage it will probably remain slightly, maybe a little more, but nothing very substantial. The other cost which goes down, which we are looking at very carefully, is making travel more effective because as you see, travel has become extremely expensive. So we are being a little more cautious using a lot of teleconferencing facilities, video conferencing facilities, to make sure that reviews, travel, etc.
Is under check. Obviously it can’t be so much under check because it becomes counterproductive. But to answer your question, we are not following anybody. We have our own strategy. We don’t have such crazy cost on human resources. But yes, there is obviously enough and more can be done to make the current resource more productive. We have taken one action every year. There are certain attritions which happen in some places. We have not filled those gaps. Those are nothing very major at all levels. We have not filled up those gaps and we have extended the people’s territory and maybe at the plant also we have extended a little bit of their responsibility.
But those are not crazy numbers. They’re 2030, which we have not further replaced and rather extended the current team’s responsibility. So we are very focused on not letting cost go up while demand is under pressure.
Neha Talrej
That was really, really helpful. So thanks. Thanks a lot team and all. I’ll get back in the queue, thank you.
operator
Our next question is from the line of Rehan Syed from Trinetra Asset Managers. Please go ahead.
Rehan Syed
Oh yeah, good morning team and thank you for giving me the opportunity. So sir, I have two questions. First on the SMPL investment side that we have done. Sir, for the proposed 50 crore investment. Into SMPL, could you outline the expected return profile, payback period of either how it fits into the company.
Abhishek Somany
Sorry, can you speak a little slowly? I’m not understanding the lines very.
Rehan Syed
Yes, sure sir. So sir, my question is regarding the. SMPL 50 crore investment side. So you have done 50 crore investment. Into SMPL, so could you outline the expected. Hello, am I cleared?
Unidentified Speaker
Can you just put.
Abhishek Somany
Are you talking about Somani Max.
Rehan Syed
I’ll just ship my. Hello.
Abhishek Somany
Yeah,
operator
hello. Yes sir, please go ahead.
Rehan Syed
Yeah, my question is on the side of SMP and cryptic investment. So for the proposed 50 crore investment into SMPL, so could you outline the expected return profile as a payback period or. And how it fits into the company’s broader growth strategy for going forward.
Abhishek Somany
So this is. We have taken the approval from the board of 50. It’s not that we’re going to spend the entire amount. It’s an approval which has been taken, this has been taken to further augment Max to make sure that I’m running at full capacity. So we are going to be adding certain presses there because the current press, which is a continuum press, is inefficient on certain sizes. It is only efficient on the larger sizes. But to keep the plant running and not have shutdown costs, we are adding two traditional presses where we would be able to produce the slightly non value added in the interim.
At least that will reduce my losses from shutdown costs. And also we are putting in certain other balancing equipment to further augment the value addition. And we are putting a warehouse because. Because there’s non value added which will happen. This will go into a separate warehouse because we don’t have space for in the current warehouse. But therefore we will have to augment the plant to produce the other warehouse. And the rest of it is because the plant is loss making. It is to cover certain losses. But this is all through internal accruals. We’re putting in the money and the payback is quite decent if I had to look at any shutdown cost.
So we are hopeful that we will not be doing any shutdowns in the plant and we’ll run the plant at full capacity which gives me a lot of benefit even on the gas and on the production cost of every single material be it the high end material or the low end. Material that is the reason. But we won’t be spending the 50 currently. This is only empowering us to take a permission for 50 cost. I hope I am able to answer that.
Rehan Syed
Yeah, sure. Sorry. It’s a very well defined answer you have to hear. So my second question is on the retail footprint expansion side. So what is the what is the current number of explosive showrooms and multi brand outlets and what is the target by end of FY26 and how is the mix between urban and semi urban geographics? We are evolving for going forward.
Abhishek Somany
Retail expansion continues. We are at 65 dealer edition and we will be adding approximately to 250 net additions of dealers and we have targets for that as to what our net addition of dealers will yield us in terms of sales. So retail expansion continue in mostly tier 2 tier 3 towns and some unrepresented areas of tier 1 towns.
Rehan Syed
My last question maybe just cater this also like if we assume like how much percentage of revenue or other margins that we can expect for two to three years down the line can just comment number
Abhishek Somany
Sorry, can you repeat how.
Rehan Syed
Much percentage of revenue what How?
operator
Your voice is muffling a lot. Can you.
Rehan Syed
Yeah, it’s awesome. Like. Like if can put some ballpark concept like what is what we can expect revenue or are there margins growth for going forward?
Abhishek Somany
I think the margins are not going down further. So margins would only improve with capacity utilization like I mentioned earlier in the call this year with which we are pretty sure that our capacity utilization will be back in place to last year levels or probably much better than last year levels which means that we will be adding to about percent percent and a half on margin as a certainty.
Rehan Syed
Okay, thank you for your time and.
operator
Thank you. Our next question is from the line of Lokesh Maru from Nippon Indian Mutual Fund. Please go ahead.
Lokesh Maru
Hi, thanks for the opportunity. So two questions from my trade. One is just an extension of what sneak asked. Like for example if the leader attempts to let’s say two quarters down the line or whenever attempts to gain volume. Right. Once again that margin if they try to give that away to gain more volume via maybe cutting realization or so and if that gap bridges with our realization. Do you think how are you trying to fortify your position in the market on that front? That is one number two second question is regarding, you know in this in market where it has been challenging to grow single high single digit volumes, how are you thinking around market share gain and what are the areas which our major focus? It could be anything like distribution like you said, retail expansion or product or technology.
But how can that eventually pan out? And how are you thinking around that aspect?
Abhishek Somany
That’s all question is margins. If anybody thinks that they can reduce margins already an extremely commoditized business and we are fighting more B where there’s high scale tech. So if one thinks that by reducing realization or reducing prices on a sustained basis they can gain volume, I think it will hurt them more than gain. That’s not the right strategy. It erodes the brand, it erodes the gain. But yes, we’ve been able to bridge the gap between us and its leader and we will continue to bridge the gap and we are extremely confident of that. To bridge the back continuously.
Market share cannot be gained beyond the point with just reduction in prices. That’s a knee jerk. It happens for a quarter or two and then you’re back to square one. So that’s my answer on the market share. And I don’t need to fortify myself. In fact, my challenge is that how I can use my capacity better at better realization. I’m not even looking at reducing. We’re going to be making better products. We’re going to be innovating. We’re already innovating on products. If you do some channel checks, you will see there’s been a large difference between what we were doing earlier and what we’re doing today.
Dealers are a lot more happier with the kind of designs and kind of innovation we’re coming out with. Long way to go. But that’s the focus. And the focus is not to reduce and go down on commoditized product. It’s all about value addition and going up the value chain. So that’s as far as that is concerned. Your second question was what? I’m sorry?
Lokesh Maru
No sir, those were the two questions. One was on the discount, the discount realization part and other was on market share. Thanks a lot.
Abhishek Somany
I think the domestic market is flat. If you look at the most of the MODI players, they are flat except a few exceptions there. Therefore, from that point of view, if we keep growing at even this pace, we are taking a little bit of market share over there. The market share is extremely fragmented and it’s more on evasion. So I don’t think that’s a sustained way of doing business where you’re selling products lower than your cost. So I believe 70 to 80 plants have already shut in Morbi. I see more of them getting shut in the next near future.
So there will be a consolidation in the next couple of years. If this is how it continues. Our balance Sheet is strong. We’re not taking the eye off the ball. On balance sheet, our continuous focus is on value addition. Continuous focus is on capacity utilization. Obviously both of them have been in pressure. But while we do that, we keep our balance sheet under check. And I’m very, very confident that we will be able to do both of those over time. It is a brand which has been selling a lot of mass products. It takes time to move up the value chain, but it will help.
Lokesh Maru
Thank you so much, sir.
operator
Thank you. A request to all participants. Please restrict your questions to two questions per participants. Our next question is from the line of UDIT from. Yes, securities, please go ahead.
Udit Gajiwala
Yeah. Hi sir, thank you for taking my question. So since you mentioned that you are sticking to your guidance for this year, have you seen any improvement which is kicking in or the hopes are on H2? This is. And also in extension, in terms of the MAX plant, what was the utilization and are you seeing any structural shift or anything happening more towards mass market or low end tiles?
Abhishek Somany
There are two segments. Mass market is a separate segment. Value addition is a separate segment. There is a larger demand and larger traction for value added segment. Obviously it’s a very small part, but there is more and more traction happening. And at Max plant, to answer that question, we are at about 51, 52% capacity utilization. Therefore we are putting these pressures to make sure that we go above 70, 75% capacity utilization in H2 or more. So that’s the idea to produce a little bit, not the entire MAS product, but a little lower quality product, sorry, lower price product than what we’re doing in MAX currently to avoid any further shutdowns.
So that’s as far as MAX is concerned. As far as distribution is concerned, it is going to be tier 2, tier 3. We continue to add distribution.
Udit Gajiwala
All right, sir. And so what would be the B2B mix for us and how is that PI growing?
Abhishek Somany
It’s the same. It’s about 75 to 77% is B2C and the rest is B2B. And all efforts are on to see how we can increase the B2B by at least 5, 6% so that we are able to use capacity utilization. But while doing that we are also in very careful of our receivables because B2B is where you get stuck with receivables and which we don’t want.
Udit Gajiwala
And just similarly like receivables, what would be the margin differentials between the two any kind projects is obviously depends on the project.
Abhishek Somany
Some projects buy also the value Added. But generally there’s a, I wouldn’t know the back of my hand, but about 4,5% difference in the investment in the margin between retail and projects. But it’s not more than the margin is the delayed receivables which further impacts the product.
Udit Gajiwala
All right, sir. Thank you sir, and all the best.
operator
Thank you. Our next question is from the line of Anubhav Goel from Cosma Ventures. Please go ahead.
Anubhav Goel
Hi sir. Sir, can I get a region wise split of our sales?
Abhishek Somany
Approximately 38, 39% is north and about 27% is south. And the rest is kind of equally divided between north. I’m sorry, it’s 41%. South is about 27% and the rest is divided between east and west. And 3%, 2.5%, 3% is exports.
Anubhav Goel
Got it, sir, Got it. And so just a general question on the industry. So like are we finding, you know, small guys at very low bases innovating on designs? They come, you know, you know, to attract architects in terms of designs and trends. Like is that become more so important in today’s time versus say a decade back and like how are we placed on that front?
Abhishek Somany
It’s not a question of attracting architects. I think these smaller players with single dealers, they’re able to incentivize the architects a little more. But beyond which it’s not a specific trend. We have seen more B, always have these three, four players which do well and then they crash and burn. Now also we’re seeing in more B there are one or two industry leaders which are obviously doing well, but under them there are five, six people who are coming up, coming up with designs. But at the end of the day their finance is tax evasion. You remove the tax evasion and they don’t have any finance anymore.
They’re able to do all of these investments basically based on high scale tax evasion. And the more higher the margin business, the more attractive is the tax evasion and incentivization.
Anubhav Goel
So sir, for these small players, Maybe I’d say 50 crore sales, 70 hundred. Where you know, we feel they might be doing better on terms of designs. The tax evasion point would apply to them as well.
Abhishek Somany
Yes, correct. They’re not doing better on terms of design. It’s just that they have a single dealer in a particular state or particular city. They have two dealers. Obviously the there’s not much competition. They’re a small base. They’re able to incentivize the dealer more. They’re able to incentivize the consumer and the architect more because of this. But it’s not that they have better designs. That’s a very, very subjective term. The smaller players do not have better designs.
Anubhav Goel
Got it, sir. And so you mentioned, I think even we have taken a lot of work versus earlier in terms of becoming more aggressive in terms of our design. So we are doing work on that front. Yes.
Abhishek Somany
And we are doing another launch in September and then another launch soon after Diwali. So you’ll keep seeing better and better products and better and better designs coming from us.
Anubhav Goel
Okay, and so just my final question on our Max plant. So this, you know, where we are playing the gbp. So this, this would be sort of mid premium, right? In today’s market. Not like very high premium or max is premium.
Abhishek Somany
Max is not mid premium. The investment which we’re doing is to go to mid premium, which is part of the plant will premium. We’re pushing for the premium, but I don’t want to dilute the premium to just get into mid premium. So the idea would be in the interim to stop any losses and therefore shut down losses. Therefore we are going to make the plant a little fungible. Not entirely fungible. A little fungible to make also the mid premium, which is pretty much everybody is doing that, even industry leaders who have done the same thing.
Anubhav Goel
So, sir, we in. So you would see the opportunity is massive. It’s like. Or is there a thought we need to, you know, keep trying to go up the value chain in terms of realizations or you feel the opportunity is massive enough.
Abhishek Somany
The opportunity in both the commodity, not the really commodity, but the mid premium and the premium. The IC tiles as extremely commoditized, low margin, but still, still a lot of opportunities for people who have good balance sheet and have a good distribution.
Anubhav Goel
All right, sir, got it. Thank you so much. Thank you so much.
operator
Thank you. Our next question is from the line of Keshav Lahoti from HDFC Securities. Please go ahead.
Keshav Lahoti
Hi. Thank you for the opportunity. So one thing I want to understand. Normally if we see your Q4 to Q1, that is Q1, Q4, you know, the volume decline possibly what we see, the industry leader would be around 20%. But you are somewhere around, let’s say 10%. There is a good gap of, you know, 10 to 12%. And we have seen in earlier years also at times. So what is the reason for the same.
Abhishek Somany
Q2 Q4 generally you pressure the system and sale sell probably 10, 12 days more in Q4. And plus the government also is finishing their, you know, they need to spend their Money. So obviously Q4 on all accounts in India is higher. Government spending need to be saturated. They need to spend their amount to get the next year’s budget. So therefore everybody is looking at you know, picking up as much material. We also have certain incentive schemes for dealers which are yearly turnover discount scheme for the year. In case there is somebody who’s lagging behind they try to make up that so that they get that annual incentive.
So all of that generally Q4 on any building material industry. Not only tiles, any single building material industry would be higher than Q1.
Keshav Lahoti
No, I understand. Normally Q4 is higher than Q1. My question is more if I see Q1 Q decline which. Which for Somani is 22% while the same number industry leader is 10%. So there is a big difference of 12%. So is there anything different?
Abhishek Somany
Maybe if Q4 wasn’t as good as ours. That’s the difference if you look at better.
Keshav Lahoti
Understood. And one thing normally the accelerated depreciation which was charged for you know last two, three quarter which was supposed to you know get over in Q4. This time also we see the depreciation is higher. When you feel the depreciation will get to a normal run rate of let’s say 19, 20 crore which you have guided earlier. Okay.
Kumar Sunit
So it has normalized and we have explained this in last Q4 call also that it has reached to new normalized level which is annually number of around 110 and odd crore rupee plus minus 57 crore rupee. And we would be remain at that level. Earlier it was lesser and we have done a certain revision in the life of assets. Certain key equipment. And that was related into this increase. Now this is my normalized level.
Keshav Lahoti
Got it. That is helpful. Thank you.
operator
Thank you. Our next question is from the line of Utkarsh from Bob Capital. Please go ahead.
Utkarsh Nopany
Yeah. Hi. Good morning sir. So my first question is regarding your own manufactured plant sales volume. See our own manufactured tile sales volume has been under pressure for the past eight consecutive quarter. So can you please help us understand. Is it because that the market size for our own manufactured ties is shrinking or we are facing step competition from the Modi players. So we are not able to grow our volume over the past two years.
Abhishek Somany
No. So first of all trading you’re seeing gone up because we sold two of our joint ventures and all those joint. Both those joint ventures are actually supplying to us the same amount as what they were supplying earlier. So nothing has changed. It’s just that we’re not in A jv. So therefore you see the trading volume going up. But yes, our particular plants the pressure has been on the volatile. The current what we’re doing currently is we are making doing investments, small investments in balancing equipment to make these plants fungible to make also floor tiles.
So from H2 onwards most of my volatile plants other than what I need for volatile will become fungible to produce even floor tiles. So we will see capacity utilization go up significantly in H2 in our manufacturing.
Utkarsh Nopany
Okay, and what would be a gross margin profile for a max plant say in the June quarter compared to our other plants? So whether there would be a significant gross margin difference?
Abhishek Somany
That’s too granular a question. We talk of gross margin but yeah, Sunit wants to say so Utkarsh actually.
Kumar Sunit
The gross margin of max plant would not be a right number to reflect upon as of now and facing the kind of capacity utilization we are operating at and the suboptimal product mix itself though we are operating at 54% but that too is a sub optimal process product so doesn’t would not reflect the right number. I think once we are coming with this investments and that will start probably towards the Q4 then next year onwards this would be giving a right.
Utkarsh Nopany
Okay. And lastly what would be our maintenance capex guidance amount for FY26 that is.
Abhishek Somany
Same as last year. Nothing has changed.
Utkarsh Nopany
Okay, thanks a lot.
operator
Thank you. A reminder to all participants. Anyone who wishes to ask a question may press star and one on their touchtone telephone. I repeat, anyone who wishes to ask a question may press star and one on their touchstone telephone. Our next question is from the line of Bharat Kurikyala from Choice Institutional equities. Please go ahead.
Unidentified Participant
Hello.
operator
Yes sir, please go ahead.
Unidentified Participant
Yeah, so can I get some color on that? Profitability like one reason is looking good and one reason is not attractive at all.
Abhishek Somany
Not audible. Can you repeat please?
Unidentified Participant
Hello, can you hear me now?
operator
Yes, we can hear you.
Unidentified Participant
Yeah. Can you give more color on like a region wise profitability like some reason is attractive and some reason is like not attractive.
Abhishek Somany
I can’t understand you. I’m sorry.
Kumar Sunit
What is after the reason? Why do you till reason wise and what that?
Unidentified Participant
Yes, yes. Vision wise profitability.
Kumar Sunit
Profitability,
Unidentified Participant
yeah.
Abhishek Somany
Profitability is between retail and projects but we don’t count region wise profitability because in every region we’re selling the same kind of product mix.
Unidentified Participant
Okay. Okay. And can you give like a split between bathware like scientary and faucet wear, Revenue of sanitary wear and faucet wear a split.
Abhishek Somany
Yes, just a minute. So sanitiware, our revenue was 63 crores which is antiviral and basketting combined up from 61 crores. And this would grow at about in early double digits for this year. We had a plant shutdown in sanity ware in the first quarter, therefore it was lower. But we are absolutely in complete trajectory to grow at single. Sorry at low double digits for this year for sanitary wear. So that’s doing well.
Unidentified Participant
Yeah. Faucet ware revenue like faucet wear.
Abhishek Somany
Faucet and well, when I say sanitary wear, it. Sanitary wear and faucets combined, if you want granular faucets went from 28 to 31 crores but sanitary ware was flat. So sanitary ware this one this year, this quarter will be much better. So therefore we are absolutely on track for growth of early double digits.
Unidentified Participant
Okay. And little can you give gas price for QFE growth?
Abhishek Somany
A little bit, but largely across India, largely flat.
Unidentified Participant
Okay, thank you. That’s it.
operator
Thank you. Our next question is from the line of Vivek Tulshan from Newmark Capital. Please go ahead.
Unidentified Participant
Hi, could you share the total profit made or the loss made in the Max plant for the last quarter and would be fair to say that that was the key reason why the difference in profitability exists in the standalone and consolidases.
Abhishek Somany
Yes, approximately 5 and a half 6 crore rupees has been the. Sorry. 6 and a half crore rupees has been the loss from the Max plant. We’re going to reduce this loss significantly and that. Yes, that’s been the impact on profitability which over H2 will reduce and next year would probably be not there. So very, very confident of that.
Unidentified Participant
Thank you so much.
operator
Thank you. A reminder to all participants, anyone who wishes to ask a question may press star and one on their touchstone telephone. Ladies and gentlemen, we will wait for a moment while the question queue assemble. Thank you. Ladies and gentlemen, as there are no further questions, we will now hand the conference over to Mr. Abhishek Somani for closing comments. Over to you, sir.
Abhishek Somany
Thank you so much for attending the Q1 earnings call. Like I said, challenging times. But when challenging times you also find opportunities. We’re looking at opportunities. Extremely confident of increasing our bottom line and also increasing our top line. This year taken many, many corrective actions to make sure that our consolidated only betters our stand alone. Because on the standalone front we’ve done okay. But on consolidation, one or two plants which have given a loss, sanityware is back online. Max maybe will take another quarter but will be completely back online. So extremely confident on both those fronts.
Looks forward to the earnings call around Diwali. Thank you.
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 line. Thank you.