Greenlam plywood volumes rise 23% but EBITDA stays negative

Greenlam Industries Limited increased plywood sales 22.8% year on year to 1.94 million square metres in Q2FY27, lifting annualised capacity utilisation to 46% from 35%. However, Greenlam’s Plywood & Allied segment reported earnings before interest, tax, depreciation and amortisation, or EBITDA, before foreign-exchange impact of negative Rs 1.4 crore on revenue of Rs 110.2 crore.

How quickly did Greenlam's plywood business ramp up in Q2FY27?

Greenlam's plywood business ramped up in Q2FY27, with sales rising 22.8% year on year and 16.6% quarter on quarter to 1.94 million square metres. That followed sales of 1.58 million square metres in Q2FY26 and 1.66 million square metres in Q1FY27. In H1FY27, plywood sales totalled 3.60 million square metres, up 21.6% from 2.96 million square metres in H1FY26.

Production rose faster than sales during Q2FY27. Greenlam produced 2.15 million square metres of plywood, 28.6% above 1.67 million square metres in Q2FY26 and 17.7% above 1.83 million square metres in Q1FY27. H1FY27 production reached 3.98 million square metres, compared with 3.02 million square metres in H1FY26, a 32.0% increase.

Greenlam's installed plywood capacity was unchanged at 18.90 million square metres throughout the reported periods, meaning the higher output came from greater use of stated capacity rather than a reported capacity increase. Annualised utilisation rose 11 percentage points from Q2FY26 and seven percentage points from Q1FY27. The H1FY27 annualised utilisation rate was 42%, versus 32% a year earlier.

Did Greenlam's Plywood & Allied segment become EBITDA-positive?

Greenlam's Plywood & Allied segment did not become EBITDA-positive in Q2FY27, although its EBITDA loss before foreign-exchange impact narrowed to negative Rs 1.4 crore. This compared with negative Rs 3.9 crore in Q2FY26 and negative Rs 5.2 crore in Q1FY27. The corresponding EBITDA margin improved to negative 1.3%, from negative 3.8% a year earlier and negative 4.9% in the preceding quarter.

Including foreign-exchange impact, the segment reported EBITDA of negative Rs 1.7 crore in Q2FY27, compared with negative Rs 4.4 crore in Q2FY26 and negative Rs 5.1 crore in Q1FY27. For H1FY27, EBITDA before foreign-exchange impact was negative Rs 6.6 crore, compared with negative Rs 12.5 crore in H1FY26. EBITDA including foreign exchange was negative Rs 6.8 crore, against negative Rs 13.4 crore.

The reported EBITDA loss applies to Plywood & Allied rather than plywood alone. Greenlam defines the segment as plywood, decorative veneers, engineered floors and engineered doors, and does not disclose standalone plywood EBITDA. Segment capital employed was Rs 324.3 crore in Q2FY27, down from Rs 354.3 crore in Q2FY26 and up from Rs 320.4 crore in Q1FY27.

What happened to Greenlam's plywood pricing and segment margins?

Greenlam's average plywood realisation increased 4.2% year on year to Rs 257 per square metre in Q2FY27, but fell 6.7% from Rs 276 per square metre in Q1FY27. The Q2FY26 realisation was Rs 247 per square metre. Across H1FY27, average realisation was Rs 264 per square metre, 3.6% above Rs 255 per square metre in H1FY26.

Plywood & Allied revenue rose 7.5% year on year to Rs 110.2 crore in Q2FY27 and was 3.9% above Rs 106.0 crore in Q1FY27. H1FY27 revenue was Rs 216.2 crore, up 13.5% from Rs 190.5 crore in H1FY26. Since Greenlam reports segment revenue and plywood volumes separately, the presentation does not assign this revenue growth solely to plywood.

Segment gross profit was Rs 55.1 crore in Q2FY27, up 4.2% from Rs 52.9 crore in Q2FY26 and 8.7% from Rs 50.7 crore in Q1FY27. Gross margin was 50.1%, down 150 basis points from 51.6% a year earlier but up 220 basis points from 47.9% in Q1FY27. A basis point is one-hundredth of a percentage point. H1FY27 gross margin was 49.0%, compared with 49.1% in H1FY26.

How does Greenlam's plywood ramp compare with other segments?

Greenlam's plywood annualised utilisation of 46% in Q2FY27 was below the 61% reported for chipboard and the 79% reported for Laminates & Allied. Plywood & Allied reported EBITDA before foreign exchange of negative Rs 1.4 crore, while Panel & Allied reported positive EBITDA before foreign exchange of Rs 8.7 crore on Q2FY27 revenue of Rs 107.0 crore. Panel & Allied includes plain and pre-lam chipboards.

Panel & Allied's Q2FY27 EBITDA margin before foreign exchange was 8.1%, compared with negative 15.3% in Q2FY26, alongside revenue growth of 123.9% to Rs 107.0 crore. By contrast, Plywood & Allied revenue grew 7.5% to Rs 110.2 crore and its EBITDA margin before foreign exchange remained negative at 1.3%. These are segment-level comparisons, as the presentation does not disclose profitability for plywood by itself.

Laminates & Allied operated at 79% annualised capacity utilisation in Q2FY27, compared with 46% for plywood, although its production fell 18.3% year on year to 4.83 million sheets. Laminates & Allied revenue was unchanged at Rs 658.0 crore, while EBITDA before foreign-exchange impact fell 32.8% to Rs 79.3 crore. At the H1FY27 stage, plywood utilisation was 42%, compared with 61% for chipboard and 79% for Laminates & Allied.

Conclusion

Greenlam's Q2FY27 disclosure shows a measurable plywood production and sales ramp without a reported increase in the 18.90 million-square-metre installed base. Production grew 28.6%, sales rose 22.8%, and utilisation reached 46%, while the broader Plywood & Allied EBITDA loss before foreign exchange narrowed from negative Rs 3.9 crore to negative Rs 1.4 crore.

The unresolved matter is whether rising plywood output and sales will translate into positive Plywood & Allied EBITDA. Greenlam gives no profitability target or timetable for the segment, so subsequent disclosures will show whether utilisation moves beyond the H1FY27 rate of 42%, realisation changes from Rs 257 per square metre in Q2FY27, and the segment’s negative Rs 1.4 crore quarterly EBITDA result improves further.