No bricks laid for revival in building materials

Pipes, MDF perform, but bathware, plywood struggle to hold up

- RAM PRASAD SAHU

The building material space continues to be hit by demand hurdles, weighing on growth prospects for yet another quarter.

The sector posted mid-single-digit sales growth in the second quarter (July-September/Q2) of 2025-26 (FY26), with plastic pipes and the medium-density fibreboard (MDF) segment posting 8-9 per cent growth, while bathware and plywood segments grew below 5 per cent. Brokerages have a mixed view on the sector, with some expecting a recovery in the second half (H2) of FY26, and others remaining cautious on the outlook.

Analyst Utkarsh Nopany of BOB Capital Markets points out that Q2 revenue growth for its building material universe remained muted for the 11th consecutive quarter. The sector rose at a slow pace of 7.4 per cent year-on-year (Yo-Y) in Q2FY26 due to the impact of heavy monsoon on construction activity and weak demand in the retail segment.

Operating profit margins, however, were up by 180 basis points (bps) Yo-Y to 12.6 per cent in Q2FY26, mainly due to a weak base effect.