Flair Writing Industries (FLAIR IN) – Q2FY27 Result Update – RM inflation & rain led disruption dents performance – BUY
Published on 03 Nov 2026
We cut our EPS estimates by 9%/7.3%/0.4% for FY27E/FY28E/FY29E as we finetune our top-line growth and GM assumptions. In an inflationary environment, FLAIR IN reported subdued margin performance with GM at 48.7% (PLe 49.8%) and EBITDA margin at 14.9% (PLe 15.8%). Further, top-line growth was also modest at 6% due to operational disruptions at Valsad amid excessive rains. Given the muted performance in 1HFY27, full year topline growth guidance has been revised downwards to ~12% (earlier ~15%). Nonetheless, led by normalization of operations, and capacity expansion in the steel bottle segment (4th line expected to be commissioned in 4QFY27E), we expect revenue CAGR of 14% over FY26-FY29E. Further, calibrated measures like rationalization of schemes/discounts and selective price hikes is expected to aid in margin recovery. Thus, we expect EBITDA margin of 17.7%/18.2% in FY28E/FY29E respectively. The stock trades at an attractive valuation of 14x/12x over our FY28E/FY29E EPS estimates. Maintain BUY with a TP of INR382 (21x Sep-28E EPS; no change in target multiple).
