Kajaria Ceramics has experienced a decline in profitability, with a contraction in margins for Q2 FY24. The company has adjusted its tiles volume guidance and EBITDA margin forecast for FY25.

As a result, earnings estimates have been downgraded for FY25, FY26, and FY27. Despite these challenges, Kajaria Ceramics achieved a healthy volume growth during a difficult quarter, although average realization fell due to increased outsourcing and a shift towards economy products.

Looking ahead, the company anticipates a compound annual growth rate in revenue, EBITDA, and PAT over FY24-27. The forecast includes a CAGR in tiles volume and a consolidated EBITDA margin by FY27. Prabhudas Lilladher maintains a rating on the stock, setting a target price.