Adhesives and construction chemicals maker Pidilite Industries expects consumer demand to remain resilient despite inflationary pressures and does not see an immediate need for further price increases in the current quarter, Managing Director Sudhanshu Vats has said.
The company, which took price increases of up to 12 per cent in tranches in the June quarter to offset the spike in crude prices triggered by the West Asia crisis, does not foresee the need for any fresh price hikes in the current quarter amid easing volatility, even as it remains watchful of the commodity’s trajectory.
Pidilite sees demand trends in July and August broadly in line with the June quarter, with overall consumer sentiment in India remaining “reasonably robust”, Managing Director Sudhanshu Vats told PTI.
“If you look at Q1 demand, demand in Q2 as well, as we travel and qualitatively see, is broadly holding,” Vats said, adding that he was pleasantly surprised by the resilience in overall consumer sentiment despite inflationary pressures.
The maker of Fevicol, Fevikwik and Dr Fixit remains confident of delivering double-digit underlying volume growth in FY27 while maintaining profitability, aided by strong demand across both urban and rural markets and a calibrated approach to pricing.
“We do not think that there is a necessity at this moment to take up any further price increase. But we will watch this space,” he said, noting that crude prices still remain volatile and could still trend higher.
Vats said even if crude settles around USD 80 a barrel against the pre-crisis level of about USD 60 — the impact typically plays out over roughly six months, and that a certain degree of “built-in inflation” from both crude and rupee depreciation would eventually need to be passed on.
He also added that Pidilite has begun issuing rebates on select brands where input costs have eased.
Pidilite’s raw material basket includes Vinyl Acetate Monomer (VAM), a key ingredient sourced from crude derivatives. VAM is the primary raw material used to manufacture Polyvinyl Acetate (PVAc), the core polymer base for white wood adhesives like Fevicol.
“We will deliver double-digit underlying volume growth at a profitability corridor or a better profitability corridor of 20-24 per cent. So we will consistently deliver double digit underlying volume growth.” Vats said the company remains committed to its long-term growth strategy rather than chasing short-term revenue targets. Pidilite’s strategy is to pass on only the absolute increase in raw material costs rather than seek additional margin expansion, he said.
“We did not price for margin. We priced for making sure that we are able to transfer the absolute increase in costs,” Vats said, adding that the hikes were carried out in a disciplined and calibrated manner over multiple tranches.
Vats added that crude prices, which were around USD 60 a barrel before the West Asia crisis, have now stabilised closer to USD 80, creating a “new normal” that has introduced a degree of ‘structural inflation’ into the economy. The depreciation of the rupee has further added to cost pressures.
“So between rupee depreciation and crude, the new normal of the crude, which is roughly around USD 80/barrel now, I think there is a built-in inflation, which has to be passed on. Fortunately, most companies like us have partly passed that on,” he said.
Despite these headwinds, Vats said consumer sentiment in India remains “reasonably robust”, helped by the staggered transmission of higher crude costs to end consumers.
“I personally feel that the consumer demand and the consumer sentiment is holding,” he said.
Unlike fast-moving consumer goods companies that have reported stronger rural growth than urban demand, Pidilite has not seen any significant weakness in cities because its products are linked to renovation, construction and repair projects rather than frequent monthly purchases. Urban demand has continued to remain healthy alongside strong rural demand, he said.
“We continue to see that uplift in urban demand as we go forward, rural is strong, but urban is also caught up. For us, the story is a little different,” he said.
Besides domestic, Pidilite is also planning to expand its international business, which contributes around 10 per cent of its overall revenue. Though South Asia remains its primary growth market, it is also selectively expanding its presence in Africa, where it already has operations in Kenya and is building its footprint in Tanzania.
“We want to explore and selectively build Africa. We have presence in Kenya through a partner and are continuing to build Africa selectively as we go forward,” he said.
Besides South Asia and Africa, the company will continue evaluating opportunities in Southeast Asia as part of its long-term international growth strategy.
On potential acquisitions, Vats said the company continuously evaluates opportunities but declined to comment on any specific transactions.
“We keep looking at opportunities all the time, but cannot comment till anything is done,” he said.
On capex, he said, Pidilite recently inaugurated a large manufacturing facility in Maharashtra and is evaluating another plant in northern India, while increasingly investing in larger-scale factories. The strategy follows the commissioning of a major facility in Visakhapatnam and reflects Pidilite’s push to strengthen its manufacturing footprint across regions.
Published on August 30, 2026
