Supreme Industries had disappointing operational results in Q2FY25, with no growth in blended plastic and pipes volumes compared to the previous year. The company attributed this underperformance to PVC price volatility, adverse weather conditions, and reduced infrastructure spending.

In response to these challenges, management has revised its pipe volume guidance for FY25 to a decrease of 16-18%, down from the previous 25%. ICICI Securities has adjusted its FY25-27 EBITDA estimates downward by approximately 8-10%. Despite these setbacks, the brokerage has upgraded the stock rating from REDUCE to HOLD, noting a significant price correction of around 21% over the past three months. The target price has been adjusted to INR 4,457, down from INR 4,905, while maintaining a core business target P/E of 39x.

The company's blended EBIT/kg contracted by 18.9% year-over-year, while pipes EBIT/kg fell by 24.5% year-over-year due to an estimated inventory loss of INR 350-400 million.