Kajaria Ceramics to Exit Plywood Business Amid Persistent Losses and Strategic Misalignment

Kajaria Ceramics, one of India’s leading ceramic and vitrified tile manufacturers, has officially announced its decision to exit the plywood business after facing continued financial losses and strategic challenges in the segment. The company’s board has approved the discontinuation of operations under Kajaria Plywood, a wholly owned subsidiary, citing a lack of strategic fit and sustained underperformance.

As part of this move, the company has fully impaired its total investment and loan of ₹112.38 crore made towards Kajaria Plywood. The shutdown process is expected to be completed by June 30, 2025. This decision is seen as part of the company’s broader efforts to consolidate its core operations and focus on more profitable segments of its business.

The announcement came alongside the declaration of Kajaria Ceramics’ financial results for the March 2025 quarter (Q4 FY25). The company reported a steep 58.6% decline in consolidated net profit, which fell to ₹43.18 crore from ₹104.27 crore in the same quarter a year ago. According to Chairman Ashok Kajaria, this drop was primarily due to provisions made for settlements with joint venture partners and vendors related to the plywood division.

In addition to plywood, the company also witnessed a weak performance in other areas. Ashok Kajaria noted that the EBITDA margin dropped to 10% during the quarter, impacted by a muted performance of the bathware division, certain losses in the UK operations, and provisioning for doubtful debts related to the plywood business.

Despite these setbacks, revenue from operations in Q4 FY25 showed a slight increase of 1.13%, reaching ₹1,221.85 crore. Tile volumes also saw modest growth, rising 2% during the quarter, though overall demand—both domestic and export—remained soft. Total expenses rose by 4.65% to ₹1,132.91 crore during the quarter.

For the full financial year ending March 31, 2025, Kajaria Ceramics reported a 30.57% decline in net profit, which stood at ₹300.02 crore. However, total revenue for the year grew 3.6% to ₹4,635.07 crore, reflecting resilience in the company’s core tile business despite challenges in ancillary divisions.

Following the announcement, Kajaria Ceramics’ shares closed at ₹799.75 on the Bombay Stock Exchange (BSE), down 2.87% from the previous trading session.

The exit from the plywood segment marks a significant strategic shift for Kajaria Ceramics, as it aims to streamline its operations and focus on high-performing, core verticals.

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