Stove Kraft Ltd (NSE: STOVEKRAFT) Q3 2026 Earnings Call dated Jan. 31, 2026
Corporate Participants:
Rajendra Gandhi — Managing Director
Analysts:
Vidhi Vasa — Analyst
Khush Gosrani — Analyst
Vinod Krishna — Analyst
Rachana K — Analyst
Pallavi — Analyst
Varun Ghia — Analyst
Anubhav Goel — Analyst
Anand Mundra — Analyst
Shreyansh Jain — Analyst
Ashwini Agarwal — Analyst
Nikhat — Analyst
Madhur Rathi — Analyst
Presentation:
operator
Ladies and gentlemen, good day and welcome to Stovecraft Limited Q3 and 9 months 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 presentation concludes. Should you need assistance during this 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 Ms. Vidhi Vasa from MAFG and Time India Pvt Ltd. Thank you. And over to you Ma’. Am.
Vidhi Vasa — Analyst
Thank you Bhumi and good afternoon everyone. On behalf of MUFG End Time I welcome you all to Storecraft Limited Q3 and 9 months FY26 earnings conference call today. On this call we have Mr. Rajendra Gandhi sir managing director and Mr. Ramakrishnan Pendala, chief financial officer and Mr. Hemant Kothari, vice President Investor Relations. Before we begin the call, I would like to give a short disclaimer. This call may contain some of the forward looking statements which are completely based upon our beliefs, opinion, expectations. As of today, the statements are not a guarantee of our future performance and involve unforeseeable risk and uncertainty.
And with this I would like to hand over the call to Gandhi Sir. Over to you sir.
Rajendra Gandhi — Managing Director
Thank you Vivi. Good evening everyone. On behalf of Stoutcraft Limited I extend a warm welcome to all participants to the Q3 and 9 month FY26 financial results earning call. We also have MEFG in time with us on this call. Who are our advisors on investor relations? Along with me is Mr. Ramakrishna Pendalya, our CFO and Mr. Heman Ketak Kothari, our Investor Relationship Vice President, Investor Relations. We have uploaded our investor desk and earning press release on the stock exchanges and the company’s website. I hope everybody had an opportunity to go through them. Global economic growth continues to remain uncertain with persistent inflationary pressures in several advanced economies and ambiguity related to geopolitical situation and tariff in USA impacting discretionary consumption.
In contrast, India remains one of the fastest growing major economies supported by accelerated urbanization, expanding consumer base and improvements in the GST policy framework are driving attractive growth opportunities for consumer durable industry mainly the kitchen and home appliances segment. These structural tailwinds between domestic and international business resulted into 96% business being contributed by our domestic business for the company in quarter three. This gives significant confidence to the team and affinity to the Pigeon brand combined with improving affordability, increasing premiumization and rising replacement demand continue to support long term sector momentum to the consumer durable sector.
Although for the current and coming quarters the export environment remains challenging. Our nine month FY26 revenue grew to INR 1,192.9 crores registering a growth of 4.9% in revenue on YOY basis with an improved gross margin of 38.8%. Through disciplined financial structure alignment, the company achieved a meaningful improvement in operational efficiency with working capital days being reduced to 43. This translated into a significant reduction in working capital debt which has come down to 80.6 crores. At the end of quarter three our flagship brand Pigeon recorded a YTD cagr growth of 9.3% reinforcing its position as a truly Pan India brand recognized for quality, affordability, brand affinity and strong consumer popularity.
During the quarter we recorded robust volume growth of approximately 38% in small appliances category and approximately 9% in Pachecar category. Further, all sales channels remained active and continue to gain momentum with modern trade and exclusive brand stores delivering particularly strong performance and achieving double digit YOY growth. Export sales has faced headwinds due to persistent uncertainty surrounding trade negotiations and tariff structures between India and the United States. Amid this, our IKEA business remains on track with business likely to come in at the end of the quarter, coming quarterly and meaningful revenue contribution expected next year. IKEA with its global presence beyond the US continues to offer strong long term growth potential as we progress towards our objective of reaching 500 standalone exclusive pigeon stores by 2027.
The company continues to scale its presence through both Cocoa and COFO retail model for the Pigeon brand. During the quarter we added 17 new stores and expanding our network to 313 outlets across 21 states and 138 cities strengthening our Pan India retail footprint. This growing consumer affluence is expected to drive growth across organized retail categories resulting in increased demand for higher quality products and enhanced service offerings. Further, our efforts have remained focused on building a strong foundation anchored in consumer satisfaction motivating us to continuously innovate. We have successfully launched Pigeon Instamami area pump snack maker which has got very high acceptance in the southern states of the country.
We are also introducing a instant water heater and uncaught dry iron to strengthen our market presence. Our in house manufacturing capabilities and deeper backward integration have further enhanced our agility ensuring consistent quality and improved cost efficiency as we move forward. We remain confident in our strategy focused on delivering consistent value, strengthening our brand and capitalizing on the opportunities. Now I will discuss the Q3 FY26 financial performance. The consolidated revenue stood at 378.4 crores for the quarter versus INR 404.1 crores in the previous quarter last year hence registering a degree growth of 6.4% year on year basis mainly due to lower export sales.
Gross profit for the quarter stood at 149.2 crores versus 151.7 crores in Q3FY25 registering a degrowth of 1.7% year on year. Gross margins for the current quarter stood at 39.4% as compared to 37.6% improving by 188 basis points reflecting the strength and resilience of the company’s business model. EBITDA for Q3FY26 stood at 35.3 crores versus 40.5 crores in Q3FY25 showing a degrowth of 12.9% year on year. The EBITDA margin for the current quarter stood at 9.3% profit after tax for Q3 FY26 stood at 4.1 crores versus 12.1 crores in Q3 FY25. The packed margin for the current quarter stood at 1.1% the quarter.
We incurred a one time expense of 4.65 crores which consists of 1.24 crores for additional provision for gratuity and leave enchantment 1.9 due to forex loss and a ECL provision of 1.51 crores. Now I will discuss the nine month FY25 financial performance. The consolidated revenue stood at 1,192.9 crores for nine months financial year 26 versus 1,136.8 crores in nine months FY25 hence reducing a growth of 4.9% year on year. Gross profit for nine months. FY26 stood at 462.4 crores versus 431.7 crores last year same time same period registering a growth of 7.1% year on year.
Gross profit margin stood at 38.8% at an increase of 79 basis points year on year. EBITDA for nine months FY26 stood at 127.7 crores versus 121.2 crores in nine months FY25 showing a growth of 5.4% year on year EBITDA margin for nine months FY25 stood at 10.7% profit after tax for nine months FY26 stood at 35.9% versus 37.1 crore. In nine months FY25 the PAT margin stood at 3% mainly due to one time extraordinary impact of 4.65 crores. The company undertook a substantial debt reduction of rupees 80 crores during the quarter which is expected to result in lower interest expense and support margin enhancement in the upcoming periods.
Now I would request the moderator to open the floor for question and answer. Thank you.
Questions and Answers:
operator
Thank you very much. We will now begin the question and answer session. Anyone who wishes to ask a question may press star and one on their touch tone 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. The first question comes from the line of Khush Goswrani from GOG pms. Please go ahead.
Khush Gosrani
Yeah. Hi sir, how are you? Just congratulations on recent set of numbers. Given the market environment how should one thing growth in the coming quarters Given that the domestic demand is on the green.
Rajendra Gandhi
Thank you. Of course the domestic business is quite strong and robust and the demand continues to be better than the previous period. Of course we are the last quarter and the first quarter generally are softer quarters for us. But compared to that we are seeing good January so far.
Khush Gosrani
Got it sir. And in terms of the commodity cost, despite rising commodity cost we have reported highest gross margins. So going ahead how should we think about it? Because they have been very volatile over the last two months.
Rajendra Gandhi
Yeah. The commodity markets are going through very. I can say volatile times. While we protect our margins by having a price. I mean purchase mechanism which. Which can take care of a quarter. All our arrangements with large commodity buyers is linked to the previous quarter. So we are protected for further quarter. But going forward we also. We have no choice but to pass on the price impact into to our consumers. And we have already taken enough measures to address this. We are actually passing it. Passing on the price increase to our consumers.
Khush Gosrani
And the last question. Despite the one offs the other expenses still on the higher side. So is there any element that of a higher advertisement cost or the. Any operational cost coming in?
Rajendra Gandhi
Yeah, the third quarter, the third quarter and our. We have been very successful in launching a product in south India. Maybe you are in a different part of the country. And we have very very good acceptance of this product. So there is a little increase in the advertisement spend in this quarter. In the third quarter.
Khush Gosrani
And what would be the percentage of exports in the total top line in this quarter?
Rajendra Gandhi
You’re talking about the third quarter?
Khush Gosrani
Yeah, third quarter. Yes.
Rajendra Gandhi
Yeah, it’s very small. It’s about three and a half percent. Generally we are at 12% and we wish to grow there. But this quarter we had more challenging situation is not so very bad always. But this quarter was very bad.
Khush Gosrani
Okay. Okay, sir. And in terms of ramp up of Ikea we should see from Q4 or it is delayed the end of this quarter.
Rajendra Gandhi
Revenues will start, but meaningful revenue from next year.
Khush Gosrani
I’ll get back. Thank you.
operator
Thank you. Our next question comes from the line of Vinod Krishna from Evander Swill. Please go ahead.
Vinod Krishna
Thanks for the opportunity. Are you able to hear me?
Rajendra Gandhi
Yeah, yeah, we are clear.
Vinod Krishna
First question is on the business models. In a sense, can you explain? Because we see a lot of competition when we go to E commerce. But if you see general trade and modern trade, we only have three, four brands and that too we can’t consider Hawkins and the premium brands as competition. So if you can explain in the cookware and the kitchenware segment, how do you see yourself portioned and whom should we see as your competition and compare your growth to and in these segments. If you can, if you can give us outlook on the growth, domestic side, outlook on the growth and more about competition.
Because everybody comes and tries on E Commerce you see too many brands, but on ground you don’t see that many brands. So how do you see that and how are you positioning yourself? And you all you are known. You are one of the two players who have own retail outlets with along with the prestige. So how should we look at this business, let’s say as an industry. So if you can please help us.
Rajendra Gandhi
Let me explain to you the TG that we address. We are the leaders in the category that we do. The opportunity is immense and large. We are currently approaching the small appliances growing disproportionately to the industry. And even in the pressure cookware segment, we grow disproportionately to the industry. The opportunity on cookware is large. We are still to address that opportunity fully. But to answer your question, of course there is a huge room for us to acquire more market share within the opportunity that is available. And we are fully available through the general trade also.
And apart from the general trade network that we have, we are expanding our stores. So for us is a startup E Commerce, modern trade, general Trade and our own retail. We would want to be present in all this. All these channels are very important for us. We will give equal attention to all of them and we’ll want to grow all of them. We want to see ourselves as leaders in continue to get to leadership in business in total while we are the leaders in the PG that we address today.
Vinod Krishna
So when you say TG can you if you can expand and you can talk about who should we see as your competitors and compare with if you. Can and your general comment
Rajendra Gandhi
we are only acquiring market share. We are only acquiring market share so I don’t see we have the competition actually we continue to acquire market share in each of the segment that we are present in the domestic market.
Vinod Krishna
But if you see prestige growth is higher than our growth. So how should we see I’ve got the in domestic they have grown 12 12% so how should we see not just this quarter in general their growth is higher. Hawkins, I’m not comparing so I’m just trying to understand when you say leader, can you tell me exactly what is the market share in pressure cookers at least?
Rajendra Gandhi
So we are moving towards being the largest by unit units on pressure cooker in this country. And since you mentioned the brand, I want to say in the last five years we were 2/3 of their revenue which we have. We are closer to 60% of the revenue. So the growth is by far I can say disproportionate. There is no way that any other brand in the country in the category that we are operating in the last five years have grown faster than us. Nowhere near rather.
Vinod Krishna
So can you at leave guide us 15% growth you are guiding in previous con call. So can we stick to the 15% growth on the domestic side at least till this.
Rajendra Gandhi
While our aspiration is there, we will still be on the double digit though you don’t see the double digit. We are at about 9% on the vision growth for this quarter. But for the annualized we will still be better than I mean if not at the 15 definitely higher than the double digit based baseline.
Vinod Krishna
But given Ikea and if at all.
Rajendra Gandhi
Let’S say we have those are export, those are export businesses. We actually anticipate in the future our export business to stabilize again and grow much faster than the domestic business. We are talking about these two different business separately. The impact in the current quarter. Let me explain to you the impact in the current quarter. We have witnessed a quarter which was minus Diwali Diwali sales. So the comparable quarter may not be appropriate but in spite of that the domestic revenue was in in line the previous quarter of the same time without the Diwali because the overall revenue got impacted on exports.
We have a degrowth.
Vinod Krishna
Such a small request, sir. This is not a question. You if you can in your presentation, if you can do also challenge channel wide sales division it would be very helpful because now we have become Omni channel. Your large part is coming from E Commerce. It will help us to see channel wise what your sales and volume like you give the category wise, product wise. If you can also give the channel wise, it will be very helpful for us, sir.
Rajendra Gandhi
We generally provide you the growth that we do on each of the channels in our presentations and that’s it. But if you want I’ll just give you the nine months and the quarter gone by.
Vinod Krishna
Yeah, Channel E Commerce gtv.
Rajendra Gandhi
You can. I’ll give you all the channels. You can write down if you require.
Vinod Krishna
Thank you sir.
Rajendra Gandhi
For nine months the contribution of GTE for the quarter gone by was 38.5%. E. Com was 34%. 12% came from modern grade. We have corporate sales, this is 3.3%. Our own retail contributed to 8.5% and OEM export was 3.7%.
Vinod Krishna
Got it, got it. So thank you sir. And so at least in the domestic we can take double digit growth for next two, three years, right?
Rajendra Gandhi
On the domestic, yeah, we are very confident, sir.
Vinod Krishna
And margins are. If you can give guidance about EBITDA margin. I’m not talking about. I know you can easily pass on because given your pricing you can easily find backward integration. You can easily pass on the cost and still be affordable. But in general, EBITDA margin, any guidance.
Rajendra Gandhi
You will see improvement on both our gross margin, EBITDA margin and the path margins. At least 1% year on year.
Vinod Krishna
At least 1% year on Year. So thank you very much. And debt. Sir, this is the last question. Sorry. Debt to be debt free by this year and. Right, because that was your guidance.
Rajendra Gandhi
Yeah. Cash debt free. There is an accounting debt. So we are already reduced. Our total working capital has come down to 80 crores from its previous 160 crores.
Vinod Krishna
Leave the least part, sir, but normal debt like real bank borrowing, that was answer.
Rajendra Gandhi
Normal debt should be close to zero.
Vinod Krishna
Close by by.
Rajendra Gandhi
So there is a supplier. No. So that is the money that we borrow from the bank will be zero.
Vinod Krishna
Not the lease liability. Leave the lease liability.
Rajendra Gandhi
Yeah, yeah. Then we’ll be close to zero already sir. Or by ren by the year end.
Vinod Krishna
So thank you very much sir. And all the business.
Rajendra Gandhi
Thank you.
operator
Thank you. Our next question comes from the line of Rachna K from Simpl. Please go ahead.
Rachana K
Hello. Hello. Am I audible?
Rajendra Gandhi
Yeah, you’re loud and clear, madam.
Rachana K
Okay, thank you. Within the other appliances category, could you provide some color on mixer grinders as a category excluding Nutri blenders including trends for us in terms of revenue scale and profitability over the last two, three.
Rajendra Gandhi
Years is very difficult to give you product wise, but we can definitely share it with you. We love to decode those details. But in the small appliances category we are growing very fast. For us in the small appliances category, the mixer grinder is the weakest one. But we are growing very fast in the Nutri blender.
Rachana K
Okay, so how do you, how do we position our mixer grinders across channels? And has a mixer grinder portfolio seen any pressures related to competition? Some qualitative color only on the mixer grinder category if you could provide.
Rajendra Gandhi
So we believe that mixer grinder is a clutter category and we believe that it is a margin drainer. We will continue to be in the mixer grinder until unless we innovate we are able to get some cutting edge innovation. I don’t see very high numbers coming from mixer grinder still. It is 100 plus crore category for us, but it is a very cluttered, low margin business for us. We are agnostic to margin and we will not want to have differential margin between different, different products. Being a highly competitive appliance appliance in the, the mixag being in that category and could be that could be the reason for our lower, you know, I mean we, we don’t, we don’t stand generally in any of the category that we are, we’ll be in the top three.
But mixer grinder, we are far away from any of those. So I will want to guide you. On the mixer grinder alone. I don’t think we will put all our efforts to build only the mixer grinder. We would want to build more of appliances and be get to leadership in the appliances as a whole rather than only focusing on the mixer grinder.
Rachana K
Okay, understood. One more question. Cooktops as an overall category used to contribute around 25 to 30% in FY22 and now, you know, annually it contributes around 20%. Within this, the mix of induction cooktops has remained stable while the gas cooktops has declined. Could you help me explain the reason for this decline in mix? Whether it is driven by competition or whether as per our ambitions of profitability it was not favorable compared to other appliances and Broader categories.
Rajendra Gandhi
No, we are growing the cooktop business both in induction and glass top. But we let go one channel completely. In the past we were leaders in the channel. It was a co branded channel with the oil companies which we completely let go. So we are building the cooktop business minus that channel. At some time it was. It was contributing to about 60, 70% of our cooktop business. Today we don’t do any business in the co branded channel and that’s why you will see realignment on the numbers. But we are. When you take the other channel standalone, we continue to grow.
Rachana K
So after the exiting business with the oil companies, how has the business grown profitably? If you could explain that as well.
Rajendra Gandhi
For cooktop, definitely it is a higher margin business compared to the co branded oil company business. And for us, as far as. As far as margins are concerned, I again want to reiterate that we are agnostic on the margins by product or by channel. More or less we’ll be in the same range. For us even the cooktop or the induction cooktop. Of course, induction cooktop. We are carving very large market share by absolute numbers. We are leaders in this country and growing on the glass cooktop business. We are also still building the business without the oil company business.
So we are able to get back to leadership. Again, the margins are agnostic.
Rachana K
So what would be the effort for building the cooktops business if you could?
Rajendra Gandhi
Again, we have a very strong backward integrated facility for making cooktops. Particularly we make none of the brands that in the country that operate will have a facility like that. We also process the glass ourselves. So we have a complete cost and quality control along with the supply chain control. So with that we are continuously working on innovation and as we innovate we will be able to get more, more and more market share. But we are growing.
Rachana K
Okay. And about steel cooktop.
Rajendra Gandhi
Stainless steel cooktop is slowly fading. At some time in the past it was only stainless steel cooktops. It’s a very small contribution to the overall cooktop business is less than 5,6% of business. 5,6% of our LPG business.
Rachana K
Okay, understood. Thank you.
operator
Thank you. In order to ensure that management is able to address questions from all the participants, please limit your questions to two per participant. Our next question comes from the line of Pallavi from Samiksha. Please go ahead.
Pallavi
Yes, thank you for taking the question. This is regarding right now the you mentioned about the exports hitting the cookware segment. So what would be the number of excluding exports, the three cube growth in cookware and have we also Introduced nonstick apart from non stick cookware, the other cast iron or other types of cookware, stainless steel.
Rajendra Gandhi
So stainless steel is one range that we will build. But the rest of the cookware we have a complete stack. We continue to make nonstick cookware that what you may mean by nonstick require is a PTFE coating. So the variant in the nonstick require the emerging coating is ceramic coating. We are actually both when you combine exports and domestic they are by far the largest in that category now. And we also of course have a completely automated line for making cast iron cookware. And we are gradually just started we have introduced to the market a new range of cookware we call this Ceraclad.
It is a stainless steel aluminum ceramic coated cookware. So I think with addition of stainless steel range of cookware will be complete. On the cookware. We are again in the cookware business growing very fast.
Pallavi
What would be the growth excluding the export number in the domestic market for cookware?
Rajendra Gandhi
Have to work on that because I currently that.
Pallavi
And my second question, sir was on cooker Cat.
Rajendra Gandhi
I love to. I’ll have to subtract the. Because for US cookware we have a number that includes export business. I will separately make and send it through our investor relationship.
Pallavi
My second question was on cookers. What is the kind of growth we expect in the future this quarter? We’ve been slower than the leader Hopkins in terms of growth in the cooker category. Just wanted to understand that slower growth.
Rajendra Gandhi
By unit numbers we are growing faster than by unit numbers we are definitely growing faster than any of competing brands. And for us yoy absolute value growth on pressure cooker alone is at about 4%.
Pallavi
Right. So the price hike you mentioned you’ve taken, how have you taken in this category also in this quarter?
Rajendra Gandhi
No, yeah, we are working on that. We are protected for this quarter, but for the coming quarter, at the end of this quarter we have already announced those price corrections and which will be effective from say March and we’ll start seeing real time correction from April.
Pallavi
Right sir, I’ll come back in the queue. Thank you so much.
operator
Thank you. Our next question comes from the line of Varun Gia from Equity Capital Advisors Private Limited. Please go ahead.
Varun Ghia
Hi sir. So my first question is if you could throw some light on what are the challenges in export because Q2 was very good despite tariffs. So what has changed now? And previously your growth outlook on exports was 40, 50%. So how would you see that going forward? And also if you could.
Rajendra Gandhi
Yeah, yeah, you please continue your question.
Varun Ghia
No, you can. I’LL ask you a second question later.
Rajendra Gandhi
Okay, so there are two aspects to the export. We did have some challenges in the first quarter when which we had to complete those orders in the second quarter. So there was a stack up of the inventory at the customer as a customer’s point. And so from the fourth quarter it is back to normal on that particular category. And we have developed three other product categories for exports. We have also had alignment with our customers, but they are unable to initiate those orders until this tariff stabilizes. We are very confident that in the near term this there will be some clarity and stabilization of the tariff.
And so these are on pause at the moment while we have developed it. And our export growth potential is also driven by our new customers like ikea. So considering all this, we were very optimistic on our growth. We will end that growth for exports in the year. But definitely the quarter gone by was very, very subdued.
Varun Ghia
The export outlook is not clear. Basically.
Rajendra Gandhi
Can you please reframe? So I’ll tell you, our existing categories continue to grow. The new business is yet to start. The new business is the IKEA business yet to start. We are also working on some other countries, but the existing business with our U.S. customers continue. The new development of new product categories with our American customers are in pause.
Varun Ghia
Okay, and secondly, what was this Forex loss of 1.9 crores? Is it due to some hedging? Because we don’t import anything. Right. And there was a depreciation of why not?
Rajendra Gandhi
So while we have a hedging policy, there was very disruptive volatility in the forex. And this mainly is actually a unrealized provision that has been made for some capex which have, have deferred payment. We would have bought these machines. They are on LC payment. And so these are unrealized loss that we have provided.
Varun Ghia
And what is the ECL provision related to 1.5 crores?
Rajendra Gandhi
The the rest of GIGI generally hedge both our receivables and payables. Our payables are mostly in CNY and receivables are in dollars. The because the receivable, the export business is a long term, we’ll have a plan for a year. We are able to hedge for longer periods and the payables are for shorter periods. Generally we pay them in 30, 60 days. And so our payable hedging policy for the mean, whatever important and aware of the payment, we hedge. So both sides, we hedge.
Varun Ghia
Okay, and what was the cash flow from operations for nine months? If you could provide that number.
Rajendra Gandhi
Yeah, just one minute. 242 crores.
Varun Ghia
242 crores.
Rajendra Gandhi
Yeah.
Varun Ghia
Okay. That is. Okay. And lastly you mentioned that you will still continue to do a double digit revenue growth. So you will have to do almost 400 crores of top line in Q4.
Rajendra Gandhi
And hopefully. Hopefully we should be closer to that open.
Varun Ghia
Okay. And rashly you give a breakup of the revenues for nine months. There was some mismatch in numbers you mentioned. Export was just 3.7% which comes to.
Rajendra Gandhi
Only for the quarter.
Varun Ghia
For the quarter for nine months.
Rajendra Gandhi
No, no. My nine months is much. I have just. I will give you just a minute. My mistake. 11.4% is for the nine months and for the quarter was 3.7%. The numbers I gave you was all for the quarter three. If you want the number for nine months, I’ll completely give it.
Varun Ghia
No problem. Thank you. I’ll come back in the class.
Rajendra Gandhi
Thank you.
operator
Thank you. Our next question comes from the line of Anubhav Goyal from Cosmo Ventures. Please go ahead.
Anubhav Goel
Hi sir. Sir, just confirming if I caught it right you’re saying exports for the year we will see growth on top of the 160 crore sales number we recorded for FY25 and 4Q will be back to normal. Is that correct?
Rajendra Gandhi
You’re right.
Anubhav Goel
And the nine month sales number for exports comes to around 136 currents based on December.
Rajendra Gandhi
Yeah. So for the ninth month we don’t have a big degrowth. But for there was a huge bid.
Anubhav Goel
And so any. Any. Any.
Rajendra Gandhi
For the ninth month we have a small growth. 2.2% growth for the yoy for export.
Anubhav Goel
Any color for FY27. Like do we see export sales remaining around 160. One hundred and seventy crore sales. Or we can head up higher to say 190. 200.
Rajendra Gandhi
You’re talking about FY26 or FY27.
Anubhav Goel
FY27.
Rajendra Gandhi
27 will grow over the current year. We have this complete new business coming from Ikea. And the current business itself if it normalizes will be in the range that you mentioned. So we have the nine month. That about export business is 136 crores. Right. So we will be closer to the number that you mentioned for the year. But for the FY27 definitely we have a complete new business with IPR coming.
Anubhav Goel
Got it, sir. So sir, regardless of the tariffs being lifted we at least at the bare minimum expect these numbers to sustain.
Rajendra Gandhi
Yeah. If the tariff continues, the existing business will continue. The new business from US market will may not Grow and then there are other markets that you are exploring And Ikea business will get is closer to beginning. And that is a very steady state business. And this, this is a global business and not linked to any one country.
Anubhav Goel
And so given that we have seen a strong domestic sales number for 3Q and you mentioned 1Q and 4Q are usually weak for the domestic business. So any color you can give for the domestic business for 4Q.
Rajendra Gandhi
For the Q4.
Anubhav Goel
Yes.
Rajendra Gandhi
Q4 business is good. I said January is doing very well.
Anubhav Goel
Okay. And so gross margins really improved this quarter 39%. So with the rise in copper and aluminum prices do we see the risk of these margins going back to say 36, 37 or we should broadly with the price hikes coming through sustain at these levels.
Rajendra Gandhi
So we would improve our margins by at least 1% year on year. I don’t see be slipping from that. There’s a constant endeavor to correct our margins. We will pass on any price increase. Of course there will always be that lag both sides. We are generally protect all our costs for a quarter. Try to protect our cost for a quarter. That’s how our new business arrangement with our suppliers is.
Anubhav Goel
Got it sir. And sir, finally last question. Can you share the 9 month sales.
Rajendra Gandhi
Number for your cast iron footwear?
Anubhav Goel
I think you have shared a 17 crore sales number for one queue.
Rajendra Gandhi
Okay, we will share it. I don’t have readily. I will give you the concern sales. Our investment relationship will send it to you.
Anubhav Goel
All right. Thank you. I’ll get back in with you.
operator
Thank you. Our next question comes from the line of Anand Mandra from SOL Wealth. Please go ahead.
Anand Mundra
Good evening sir. Sir, just wanted to check how much is export growth. You said for 2% for first nine months.
Rajendra Gandhi
Yeah. Good afternoon. Good evening. So yeah, for nine months last year it was 133 crores. And we are at 136 crores for nine months currently.
Anand Mundra
Okay. And sir, how much is the degrowth in absolute amount in Q3? Sir, in exports.
Rajendra Gandhi
Is 141 24. 2020.
Anand Mundra
So it is lower by 27 crores in Q3 as compared to last year. Q3.
Rajendra Gandhi
Yes sir.
Anand Mundra
Okay. And so what is our domestic growth for the first nine months? Sir, it’s a 9%.
Rajendra Gandhi
You mentioned Vision brand is about 9% for nine months. It will launch for the quarter it was. I’ll give you the nine. Nine months 10.3% domestic business growth. Yeah.
Anand Mundra
Okay. So one small request. If in presentation we can give the breakup of export and domestic business. Because export has Become big and any variation may give a wrong picture on the overall on the company, sir.
Rajendra Gandhi
So you are suggesting to us to give domestic and export business growth and.
Anand Mundra
Degrowth or absolute amount breakup of revenue per quarter. If someone can comment on in our.
Rajendra Gandhi
Numbers we don’t separately give domestic sales and it’s okay, we’ll. We’ll try to add an addendum to this presentation answer. If.
Anand Mundra
If this can be provided for this quarter also by an update to next.
Rajendra Gandhi
Yeah, yeah. This what we have uploaded. We’ll send you an addendum. We’ll try to do that.
Anand Mundra
Yeah. So second thing sir, so what is your guidance on gross margin given? Actually someone has already asked. So you maintain that you would be able to maintain 39, 40 gross. 39.5 gross margin given the rising commodity prices, sir.
Rajendra Gandhi
So currently we are targeting to get to 39% and we believe that year on year we’ll be able to improve this by 1%. So you can take this kind of a guidance. It may not be absolutely like that but their kind of guidance in the next three years we would want to get to between 41 and 42%.
Anand Mundra
Okay. Sir, what is our capacity utilization in cast iron? Have we reached to profit?
Rajendra Gandhi
We are doing only domestic business. Our export business has not commenced. There is interest. We are at about 40, 45% on utilization.
Anand Mundra
Okay. And sir, have we capitalized the facility that we have built for IKEA and the deposit?
Rajendra Gandhi
That is work in progress. And before the end of this quarter will capitalize 100 of Ikea’s facility. There is some capitalization, something is pending. But before the March end will capitalize the complete facility of IKEA.
Anand Mundra
Okay, answer. Our net debt you mentioned was 80 crore as on 31st December.
Rajendra Gandhi
Yes.
Anand Mundra
And you mentioned that we will be debt free by March. That would be tough job because 80. Crores would be different. So just wanted to reconfirm that.
Rajendra Gandhi
So the debt is absolute debt. I said cash debt.
Anand Mundra
Okay.
Rajendra Gandhi
Net debt that 80 crores includes suppliers credit that we take. So I mean when you say. Okay, let me explain in simple words that I can explain to you. We will have 0cc or WCDL or any working capital loan. The debt is also including some lease financing, lease accounting and all that.
Anand Mundra
Okay.
Rajendra Gandhi
Suppliers credit.
Anand Mundra
Okay. And one last question.
Rajendra Gandhi
Currently if you want to know, I will tell you that number is below 30 crores for us on the cash debt which we are very confident of bringing it closer to. We are positive to bring it to zero but maybe closer to zero in the end of by the end of this quarter.
Anand Mundra
Okay. Understood sir. Thank you sir. I will come back to Q. Thank you sir.
operator
Thank you. In order to ensure that management is able to address questions from all the participants, please restrict your questions to two per participant. Our next question comes from the line of Shreyans Jain from Swan Investments. Please go ahead.
Shreyansh Jain
Hello sir, can you help me with the absolute export number for this quarter and last year, same quarter sir.
Rajendra Gandhi
It was. 40.6 40 crores versus 141. Sorry, 14 versus 40. Hello.
Shreyansh Jain
Yes, hello.
Rajendra Gandhi
Yeah, could you hear me? Sir?
Shreyansh Jain
You’re saying 14 versus 14 is it?
Rajendra Gandhi
Yeah. Okay.
Shreyansh Jain
So sir, if I just reduce that amount from our Q3 numbers. And we are saying we did about 10% growth in the domestic business. Right.
Rajendra Gandhi
So last year 404% for nine month period.
Shreyansh Jain
And what is the absolute domestic growth that we would have done in Q3? Sir, Q3 because I think my numbers say we are flat. 364 versus 364.
Rajendra Gandhi
Just domestic. This is nine months. You have Q3 number. I don’t think we have grown. Only domesticity about it. See the Q3 again. I want to explain to you that this Q3 is minus the Diwali sales. And the last year’s Q3 was including the Diwali sales and sales peak around the Diwali period. So while the quarter gone by for us in relative terms was very good for domestic sales, there was no drop in demand because generally immediately after Diwali the. The sales go down. I think there’s no 2.5%. We are lower by 2.5% for the quarter.
Okay.
Shreyansh Jain
And this quarter you also would have some spillover of the GST cuts that happened in Q2 and we would have lost some sales to the channels.
Rajendra Gandhi
All that is positive. All those have been positive. Generally there is a delta of at least 30% pre Diwali and post Diwali. So supposing a month, in a month, whichever Diwali is there, your sales bump up by 30% and we. So technically if we will. In relative terms there should be a drop of 30% in sales if the. The. The quarter does not have Diwali. But we had definitely. It’s not that we have grown. We are minus 2% even on domestic business.
Shreyansh Jain
Okay, answer this last question. You mentioned OCF. We have done about 240.
Rajendra Gandhi
Yeah. Can you please repeat your question, sir?
Shreyansh Jain
What is the operating cash flow that we would have done?
Rajendra Gandhi
I think we gave you know 200. Yeah. For nine months was about 240 crores. So. So that is not only coming from your gross margins or the contribution margins, but it is also an optimization of net working capital. Days have come down to 34. What is it? 42 days? One second, I’ll just keep. See, we were at 59 days in FY24. We went up to 64 days in FY25 and we have come down to 43 days for the nine month of this year.
Shreyansh Jain
Okay, answer. What is the capex that we would have done in the 9 months.
Rajendra Gandhi
CAPEX that we have done? You want the cash flow of the capex or you want the capex?
Shreyansh Jain
So obviously I have the OCF at 242. So I’m just trying to understand what is the capex that we would have done. So I’ll get the payments.
Rajendra Gandhi
Net would have paid 63 course. We have paid 63 courses.
Shreyansh Jain
63 crores. Okay. All right. Thank you. That helps. All the best.
Rajendra Gandhi
Thank you.
operator
Thank you. Our next question comes from the line of Ashwini Agrawal from Demeter Advisors llp. Please go ahead. Your voice is breaking.
Rajendra Gandhi
It’s not audible. Please don’t. There’s some problem.
Ashwini Agarwal
Can you hear me, sir? Hello?
Rajendra Gandhi
Yeah. Now. Now it’s now I’m able to hear you, sir. Okay.
Ashwini Agarwal
Sorry sir. What was the exact issue for exports falling so much in the December quarter and why do you think this will reverse in in the March quarter? Because the tariff situation isn’t resolved as we speak.
Rajendra Gandhi
Okay, let me explain to you our export business. Generally we get projection for the whole year and almost it is very close to projection. It is as close as 90. Between 96 to 100% of projection is what the revenues actually record beginning of this year. We had been discussing with our customers for new categories and we had very positive outlook on them. It is not that they have given us orders or projections with that we were anticipating high growth. But when we started this year, the first quarter we were. We had moved from non stick to ceramic and it was a new line.
We defaulted on deliveries in time for the quarter one and so there was some small cancellations. And also the deliveries that were to happen in the first quarter were delivered in the second quarter along with the orders of the first quarter. So there was a inventory pileup at the customer’s place. So that portion of the business was impacted also along with no new business coming which was anticipated. So all this put together has resulted in a lower quarter for Q3. Business for Q4 is in line with normal quarter but it does not include the possible business that we were to do with IKEA and also does not include the projections that we had for the new categories.
So I can only guide you to this, that our current business that was business as normal for the previous year remains intact. The new business is impacted for new categories. And the opportunity that is lies ahead of us is the work that we have done over the last one year in setting up the plant, developing the products. We already have the orders in, I mean orders for the whole year from ikea. And the revenues will start from actual revenue will start from first quarter or from April of FY26. April of FY27.
Ashwini Agarwal
And so just on IKEA, you know, our earlier expectation was that fourth quarter we will start the production. I mean fourth quarter we should see full production. So has it been delayed by another three months? And what would be the reason for.
Rajendra Gandhi
That delay by three months? Yes. So there are some test protocols that have to be followed and there has been delays in approval. We are at the FAG end of these approvals. There are different approach, different parameters and from different labs and from different parts of the country and multiple labs. So all this has contributed to little delay and particularly because February, some of the labs are in, in China which are doing the test in February, they are completely shut. There is a kind of annual off in February. So we are expecting these lab reports to come in March and then we’ll start commence the supplies.
Ashwini Agarwal
And would you be able to share the budget for IKEA sales for fiscal 27?
Rajendra Gandhi
I don’t think they’ll give you so much granular detail about each customer. But I can give you in broader sense that we will be in line with our exports of definitely grow end the year with growth. There is a disappointment for us and also we would have guided you through a very high growth on exports that is not happening for the current year. But if with IKEA’s additional business there will be ample growth and if there is stabilize, then there is a huge opportunity for us.
Ashwini Agarwal
And last question sir, on exports and including IKEA and I’m thinking about fiscal 27, let’s forget this year. Would you say that the margins on exports would be similar to domestic or. Would they be lower or higher?
Rajendra Gandhi
Gross margins are far lower. And ebitda, they’re at par or better.
Ashwini Agarwal
Thank you so much, sir. All the best.
operator
Thank you. Our next question comes from the line of Nikat from Daulat Capital. Please go ahead.
Nikhat
Hello. Thank you for taking my question, sir. So in domestic business you have stated 2.5% decline. So this is on the revenue decline, Right. And so what was the volume decline in domestic? That is my first question and my second question is that in small appliances our volume growth was very strong at around 38.7% but the value decline was 6,6%. So why such a high variation between volume and value for small appliances?
Rajendra Gandhi
So it also is a movement of high value products from some small value products. That could be the major reason on growth for the quarter we have. This is again quarter on quarter, right? No, you are asking about products or channel.
Nikhat
The the category, the small appliance category.
Rajendra Gandhi
Categories. Yeah. Small appliances we have actually grown 38.7% YoY and on quarter. On quarter we have grown by 25 on particularly the small domestic appliances.
Nikhat
Yes, but the value decline is around.
Rajendra Gandhi
6% value on small appliances. Yeah, decline is 6%. Yes. So it could be lower than say example if you’re selling more higher air fryers are more kettles. That could change the value proposal volume proposition completely.
Nikhat
Okay. Or is it that the competitive intensity is also high in the supply and segment. So we have not taken any price cuts because of the high competition, right?
Rajendra Gandhi
No, there is no scope for price cuts and I don’t think we have such challenges on the price front. We are actually price leader on on price front we actually are the most aggressive brand. I mean fast growing and strong brand. We are definitely a price leader. There is no such challenge on the price side and particularly the current atmosphere. Many of the components are imported because of the surge in forex cost. Whether it is RMB or dollar every cost input is going up and also there is a surge in commodity price. So both is going up.
There is no way I think anybody can look at price reduction and to add to retain that margin itself, definitely there is a costing cost increase to be passed on to the consumer. We have very strong acceptability for our products. So I don’t think we have a challenge on that. The only what could have happened is some of those categories also would have moved to in house manufacturing and the absolute value would have come down. We would have passed on some of the benefits and that’s why you are seeing your value wise T growth. But volume growth.
Volume growth particularly on small domestic appliances has been the highest both on Bio Y and quarter on quarter.
Nikhat
Okay sir, understood. And this domestic was 2.5% down. And what was the volume decline.
Rajendra Gandhi
That we. I think we’ll have to evaluate because I don’t think we have a number like that also it may not give you the True picture on volume. Because sometimes it is deceptive. It depends on which is a high value SKU or low value SKU contributing to absolute numbers. So that that could be deceptive. We can share that number still with you. Milado compile and send it.
Nikhat
Okay sir, thank you.
operator
Thank you. Our next question comes from the line of Madhurati from Countercyclical Investments. Please go ahead.
Madhur Rathi
So thank you for the opportunity. Sir. I wanted to understand with BIS implementation on Hobbs sir, how do we see the cooktop business dynamics changing? And sir, do we see a possibility of market share gains for stove graph due to this announced capacity versus our competitors?
Rajendra Gandhi
So the Hobbs have the BIS thing has been deferred for another six months. But once there is a complete restriction on hops definitely we have a better capability to any of the trading brands in the country. We definitely have an advantage. But currently it is deferred so people can still import the hops and sell. And this is up to September 26th poster. Definitely there will be higher opportunity for stock.
Madhur Rathi
Got it. And sir, did we see any. So BIS was also also implemented on chimney that we manufacture. So did we see a huge reduction in imports coming in? And what was the incremental capacity or the market size that was available post the Chinese exit?
Rajendra Gandhi
So for us also the chimney business impacted. We are always importing the chimneys. We have established the manufacturing facility for chimney. It is evolving and getting stabilized. Of course once this plant stabilizes and with imports completely getting curtailed the opportunity for us to grow there is there currently actually chimney business for us also is impacted. We are not having the full range. We are. We have started manufacturing a few. For us to get to that full fledged all the model manufacturing will take about a year.
Madhur Rathi
Got it. And sir, what is the amount of amount or the number of units of chimneys that used to come into India through to these Chinese or the capacities that are non BIS compliant?
Rajendra Gandhi
That’s very large. Actually there hardly very few manufacturers in the country. And even those manufacturing majority of them bring some SKD parts and assemble which is not economically actually feasible. The cost of SKD parts is higher than the CPU unit because of a the packaging and transportation. There are a few manufacturers. It is still evolving. The country does not have large scale manufacturing in chimneys. There is huge opportunity for anybody who’s getting into manufacturing and stockraft that having the complete end to end manufacturing to retail. I think we stand to gain. To answer your question, the overall chimney business should be in the range of 5 to 7,000 crores in this country.
Madhur Rathi
Got it. So just a final question from my end. Sir.
operator
Mr. RT, we’re unable to hear you.
Rajendra Gandhi
Yeah.
Madhur Rathi
So I wanted to understand. Regarding this chimney market. I’m sure we were expecting to have a thousand crore business from chimneys and hobs. I think we did an interview in FY22 or FY23. So when can we expect to realistically achieve this thousand crore number from these two segments?
Rajendra Gandhi
You mean thousand crore revenue from chimneys and hubs for stove crab?
Madhur Rathi
Yes, sir.
Rajendra Gandhi
Yeah. It’s a long journey. It will definitely. We are nowhere near that number. Definitely that is possible. That is the opportunity there. But it is a long journey. I don’t think it is happening in the next 12 years. But definitely that opportunity is there.
Madhur Rathi
Got it. So that was from my sir. Thank you so much and all the best.
Rajendra Gandhi
Thank you.
operator
Thank you. In the interest of time, we’ll take that as the last question. I would now like to hand the conference over to management for closing comments.
Rajendra Gandhi
Thank you everybody for participating in this conference call. We have tried to address all your queries. There are some questions that. We will send those details to our investor relationship team. If you have any questions, you can definitely reach out to us. You can also contact MUFG or Investor relationship team. Thank you again for the time today.
operator
Thank you on behalf of Stovecraft limited. That concludes this conference. Thank you for joining us. And you may now disconnect your lines.