Rushil Decor Limited: Navigating Challenges and Powering Growth in Q2 FY26

Rushil Decor Limited, a prominent player in India's wood panel industry, has demonstrated resilience and strategic foresight in its Q2 FY26 performance. Despite facing operational disruptions earlier in the year and external headwinds, the company reported a robust recovery, with consolidated revenues reaching INR 235.65 crore. This represents a 2.3% year-on-year growth and a significant 31.5% sequential increase, signaling the normalization of operations and improved market realizations. The company's EBITDA stood at INR 22.5 crore, with a margin of 9.5%, while profit after tax (PAT) was INR 5.1 crore, at a margin of 2.2%. For the first half of FY26, however, the company reported a net loss of INR 8.94 crore, primarily due to the Q1 plant shutdown.

The MDF division, the primary revenue driver, contributed INR 169.5 crore to the Q2 FY26 top line, accounting for 72% of total revenue. While this marked a marginal 1.3% year-on-year decline, it showcased a strong 36.4% sequential growth, reflecting the successful resumption of operations at the Andhra Pradesh facility post-fire incident. Domestic MDF sales grew by 5.2% year-on-year, buoyed by steady demand from the housing and furniture markets. Export revenue, however, faced a 22.9% year-on-year decline due to U.S. tariff-related uncertainties and logistics challenges. Despite this, the company's focus on value-added MDF products, which contributed 45% by quantity and 56% by value, helped improve blended realizations by 7.7% year-on-year.

The Laminates division continued its growth trajectory, recording revenues of INR 54.7 crore in Q2 FY26, an 8.9% year-on-year increase and a 22.9% sequential rise. This growth was primarily driven by strong domestic demand, with revenues increasing by 8.8% year-on-year and volumes growing by 12.8%. Export performance also remained healthy, supported by higher realizations across key geographies. The division's capacity utilization increased to over 90%, boosted by the initial contribution from the new Jumbo Laminates facility in Gandhinagar. Commercial dispatches from Phase 1 of this state-of-the-art facility have commenced, and trial production for Phase 2 has also been initiated, adding an additional capacity of 1.6 million sheets per annum.

Financial Snapshot: Q2 FY26 Consolidated Performance

Strategic Initiatives and Future Outlook

Rushil Decor's strategic initiatives are geared towards enhancing capacity, expanding market reach, and embedding sustainability into its operations. The Jumbo Laminates expansion is a cornerstone of this strategy, aiming to cater to high-growth international markets like the USA, Europe, Russia, and Australia. The company has already secured export orders from several countries, including Russia, UAE, Israel, Qatar, Saudi Arabia, and Slovakia, for these jumbo-sized laminates. Management expects the Jumbo Laminates project to contribute INR 25 crore to INR 30 crore in export revenue for Q3 and Q4 FY26, with an overall revenue target of INR 150 crore to INR 175 crore from both phases by the end of FY27.

Sustainability remains a core focus, with the company's agroforestry program successfully planting over 24 million saplings across Andhra Pradesh. This initiative ensures a consistent and sustainable raw material supply chain while supporting local farming communities. Additionally, plans are underway to install solar rooftop systems across manufacturing facilities to reduce energy costs and enhance environmental efficiency. The company also received INR 11.4 crore in incentives from the Government of Andhra Pradesh under the Industrial Development Policy 2015–20, further bolstering its financial position.

Management's Vision and Financial Prudence

Management's commentary reflects a balanced outlook, acknowledging past challenges while expressing optimism for the future. The fire incident's impact is now behind them, and operations are fully stabilized. The company is focused on improving capacity utilization, optimizing its product mix, and driving margin recovery. For FY26, Rushil Decor anticipates a total top line of INR 970 crore, with overall EBITDA margins expected to be in the range of 10% to 12%. Looking ahead to FY27, the company projects an overall turnover of INR 1,100 crore or more, including significant contributions from Jumbo Laminates and new Singapore operations, with EBITDA margins potentially exceeding 12%.

Rushil Decor has also demonstrated strong financial prudence, with its Net Debt-to-Equity ratio improving significantly from 1.10x in FY23 to 0.42x in H1 FY26. This deleveraging trend, coupled with strategic investments in capacity expansion and a focus on value-added products, positions the company for sustained growth and improved profitability in the coming quarters. The company's robust distribution network, comprising over 700 distributors and 4,700 retailers across 57+ countries, further strengthens its market position and global competitiveness.