Uflex’s Q2FY26 earnings show promise

The Board of Directors, in its meeting held on 13 November 2025, has approved and taken on record the unaudited consolidated financial results of UFlex and its subsidiaries for the quarter ended 30 September 2025.

UFlex reported net profit of INR 269 million (vs net loss of INR 646 million in Q2 FY25), underpinned by stable revenue during the quarter. On a six-month basis, H1 FY26 net profit of INR 849 million (vs net loss of INR 1,631 million) along with steady revenue growth of 3.2% YoY, reflecting the Company’s resilience and operational strength in a challenging business environment. The quarter faced several headwinds, including the U.S. imposition of reciprocal and secondary tariffs (25% each) on Indian imports, heightened geopolitical tensions and transitional challenges following the rollout of India’s new GST framework and an elongated rainy season. These collectively impacted the growth forecasts.

Normalised EBITDA stood at INR 3,895-million (vs INR 4,446-million YoY). The normalised EBITDA margin was 10.1% (vs 11.5% YoY). Profit After Tax (PAT) for the quarter was INR 269-million (vs Net Loss of Rs.646-million). In H1 FY26, Normalised EBITDA was INR 8,593-million (vs INR 9,128-million YoY) and normalised EBITDA margin was 11.0% (vs 12.1% YoY). Profit After Tax (PAT) for H1 FY26 was INR 849-million (vs Net Loss of INR 1,631-million YoY).

India continued to be the largest contributor, accounting for 47.5% of revenue share, followed by the Americas at 17.6%, Europe at 16.6% and the Middle East & Africa at 15.4%. The remaining 2.2% came from other regions, underscoring a well-diversified global revenue mix.

Packaging business 

In Q2 FY26, the packaging business segment, comprising flexible packaging, aseptic liquid packaging, and holography, reported flat sales volume growth on a year-on-year basis. However, in H1 FY26, sales volume increased by 5.8% to 76,633-mt compared to 72,400-mt in H1 FY25, reflecting sustained demand momentum across key packaging categories. Our packaging business achieved moderate growth in H1 FY26 despite GST transition in India, softer consumer spending, weaker industry performance and inclement weather.

The packaging business long-term outlook remains robust. Overall, FMCG volume growth in India stayed modest though Q2 FY26 was a challenging quarter for packaging companies in India. The combined impact of policy reforms and an unusually cooler summer across several regions led to dampened consumer spending and demand. As a result, many summer-linked seasonal FMCG product categories, including beverages and fruit juices, witnessed a weaker-than-expected seasonal volumes.

Consolidated packaging films business

Consolidated packaging films production volume remained subdued at 120,644-mt in Q2 FY26 (vs 128,880 MT YoY). While India, UAE, CIS, and Mexico reported positive production volume growth, this was partly moderated by output from Egypt, Hungary, Poland, the USA, and Nigeria. As a result, capacity utilisation for the quarter stood at 75.9%. Packaging films sales volume was correspondingly lower at 125,245-mt (vs 131,343-mt YoY).

UFlex India’s packaging films capacity utilisation improved to 79.7% in Q2 FY26 (vs 77.1% YoY). The higher utilisation supported a 3.4% YoY increase in production volume to 32,726-mt (vs 31,636-mt YoY). For the first half of FY26, capacity utilisation stood at 80.2% (vs 73.3% YoY), resulting in a 9.4% growth in production volume. This improvement reflects enhanced operational efficiency and a more supportive business environment.

In Q2 FY26, the company recorded healthy growth in packaging films sales volume, rising 17.8% YoY. On a half-year basis, sales volume increased by a robust 24.5% to 65,587-mt (vs 52,682-mt YoY), supported by steady performance across key segments.

India’s Panipat virgin PET chips plant operated at a capacity utilisation of 72.4% in Q2 FY26 (vs 74.3% YoY). Third-party sales volume from the plant reached 20,046-mt in Q2 FY26 (vs 16,358 MT YoY), increased by 24.7% year-on-year led by favourable seasonal demand.

Demand for packaging SKUs (stock keeping units) and related raw materials, including PET chips and packaging films, remained relatively subdued during the quarter, primarily due to short-term disruptions from the GST transition, which led businesses to defer new orders and focus on destocking pre-reform inventory, while consumers delayed purchases in anticipation of lower pricing.