Pidilite Industries Considers Further Price Hikes to Manage Raw Material Inflation

NEW DELHI — Pidilite Industries may implement further price increases in the second half of fiscal year 2027 to offset raw material inflation. The company aims to maintain its EBITDA margin at the higher end of its 20 to 24 percent guidance range, according to Managing Director Sudhanshu Vats.

The company has already introduced price increases of 3 to 5 percent in October, following an earlier hike of about 12 percent in the first quarter. Vats indicated that another 3 to 5 percent increase could be considered in the third quarter, depending on the specific brand and business segment. A further adjustment of 2 to 3 percent might follow in the March quarter if cost pressures persist.

These pricing actions are driven by volatility in vinyl acetate monomer (VAM), a critical raw material used in manufacturing Fevicol. VAM prices fluctuated significantly, moving from $800–$900 per tonne last year to nearly $2,000 following the West Asia crisis, before cooling and rising again. Vats noted that VAM consumption costs increased to approximately $1,600 in the second quarter compared to $1,350 in the first quarter, which exerted pressure on margins.

Despite these price adjustments, Pidilite has not observed any material impact on consumer demand. Vats reported that demand remained consistent across the first half and into the third quarter, with both rural and urban markets contributing to growth. The company anticipates underlying volume growth to remain in double digits, barring major macroeconomic disruptions such as a worsening West Asia crisis or El Niño impacts.

Repair and renovation activities continue to provide operational resilience, accounting for roughly 70 percent of Pidilite's business, while new construction makes up the remaining 30 percent. Meanwhile, quick commerce and e-commerce channels are expanding steadily, contributing about 15 percent of the company's consumer business, with smaller consumer-focused products showing strong adoption.

Pidilite is also recording positive traction across growth brands such as Roff, Dr Fixit, and its projects business alongside the core Fevicol franchise. The company's direct distribution network surpassed 25,000 points during the quarter. Investments are ongoing in plant modernization, automation, and capacity building for Roff, while the decorative paints business continues to show encouraging progress in smaller towns and rural-urban markets. Pidilite does not hedge raw material prices and intends to adjust its pricing dynamically as input costs change.

"Managing raw material volatility without losing consumer demand is a critical operational challenge for established manufacturing enterprises. Pidilite's approach of implementing calibrated, phased price adjustments while relying on a strong repair and renovation portfolio demonstrates resilient business strategy. For growing businesses and startups, this highlights the importance of maintaining pricing flexibility and robust distribution networks during periods of macroeconomic uncertainty." — Dr. Shishir Gupta, Founder & CEO, StartupLanes