Greenpanel Industries: Brokerages Suggest Target Price of Rs 332
Greenpanel Industries' Q4FY26 Results Show Resilience Amid Geopolitical Uncertainties
Greenpanel Industries, a leading player in the MDF industry, has reported a significant increase in its domestic volume growth, driven by a healthy 29.5% year-over-year (YoY) expansion. The company's overall MDF volume grew by 27.8% YoY to 130 KCBM, with MDF margins standing at 9.2% in Q4FY26. However, the margins were impacted by a significant increase in chemical prices, which account for approximately 40% of the raw material costs.
The company has also reported Export Promotion Capital Goods (EPCG) scheme incentives of Rs 62 million in Q4FY26, which has supported MDF margin. Moreover, around Rs 260 million in EPCG incentives is yet to be accrued. In Q4FY26, timber prices remained broadly stable, while chemical prices increased by 40-45% YoY due to supply-chain disruptions and elevated freight costs linked to the Middle East conflict. To offset the rise in raw material costs, the company implemented cumulative price hikes of around 15%.
Domestic MDF Industry Demand Expected to Grow
The management refrained from providing formal FY27 revenue and margin guidance due to geopolitical uncertainties and volatile input costs. However, they expect domestic MDF industry demand to grow in the mid-teen to high-teen range, with the company likely to grow in line with or ahead of the industry.
| Company | Revenue Growth (FY26-28E) | EBITDA Growth (FY26-28E) | PAT Growth (FY26-28E) |
|---|---|---|---|
| Greenpanel Industries | 15.2% | 74.6% | 219.6% |
Earnings Estimates and Rating
We have cut our earnings estimate by 15.1% for FY27E and 10.2% for FY28E. Our maintained 'BUY' rating has a revised target price of Rs 332 (Rs 370 earlier), based on 20x March 28 earnings. We estimate revenue, EBITDA, and PAT compound annual growth rate (CAGR) of 15.2%, 74.6%, and 219.6%, respectively, over FY26-28E, with MDF volume CAGR of 19.3%.
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Investor Takeaway
Investors should consider Greenpanel Industries for its potential growth in the domestic MDF industry.
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