Cera Sanitaryware Ltd

Price story Before the numbers, the tape. A stock price moves through four repeating seasons: a flat base (stage 1), an advance (2), a top (3), a decline (4). Where the price sits in that cycle frames everything below.

Cera Sanitaryware Ltd trades at ₹5,588, in a confirmed uptrend and 13 weeks into that stage. That is −3.4% against its own 200-day average. It sits at 55% of a 52-week range of ₹4,524 to ₹6,460. On relative strength it is currently behind the NIFTY 500 on a trailing-13-week view (5 weeks and counting).

Today the stock is in a confirmed uptrend — week 13 of stage 2, confirmed. At ₹5,588 it trades −3.4% versus its 200-day average and sits at 55% of its 52-week range (₹4,524–₹6,460).

Against the market, two honest reads. Cumulative: over the last 10.5 years the stock moved +217% while the NIFTY 500 moved +267% — behind the index over the full window. Recent form: on a trailing-13-week view the stock is currently behind (5 weeks and counting; last ahead the week of 2026-08-07) — the ribbon below is that same metric, week by week.

What would end the trend, mechanically: two Friday closes in a row below the 200-day line. That is the exit rule — no debates.

Story check

Cera Sanitaryware Ltd's story is not scored yet against the markers our research file set on 27 June 2026. Where it sits in its own cycle: Not stated in the research file. Our fortnightly research layers last read it on 27 June 2026.

Our read, 27 June 2026. Cera's PE at the 10th percentile of a decade reflects margin pain from brass inflation and demand softness — not business erosion — but management has missed four consecutive guidance targets, making the re-rating contingent on FY27 execution.

From the numbers. The multiple has compressed 42% from its peak of 57x in FY21 to around 29-33x today (the 10th percentile of a 40-quarter history). Critically, the earnings have NOT compressed — EPS grew from Rs 77 in FY21 to Rs 191 in…

From the price. Price stage 2, week 13 — below its 200-day line, relative strength falling.

From the research. Cera's PE at the 10th percentile of a decade reflects margin pain from brass inflation and demand softness — not business erosion — but management has missed four consecutive guidance targets, making the re-rating…

🚨 Where they disagree. The multiple has compressed 42% from its peak of 57x in FY21 to around 29-33x today (the 10th percentile of a 40-quarter history). Critically, the earnings have NOT compressed — EPS grew from Rs 77 in FY21 to Rs 191 in FY25, compounding at 17% per year. The multiple compression is entirely explained by the market applying a lower PE to lower-quality recent earnings: OPM fell from 16-17% to a trough of 10.2% in Q3 FY26 due to brass inflation and demand softness. The true story score of 0.616 reflects that the EPS recovery is just beginning (5% off trough), price fell 7% in the last year (no run-up artifact), and the valuation has genuine room to re-rate. This is a mid-journey setup in…

What is proven. Cera's PE at the 10th percentile of a decade reflects margin pain from brass inflation and demand softness — not business erosion — but management has missed four consecutive guidance targets, making the re-rating contingent on FY27 execution.

What is not proven yet. If EBITDA margin in Q1 or Q2 FY27 falls back below 13% despite the full-quarter benefit of the March-April price hikes, that invalidates the recovery thesis and suggests pricing power is insufficient against structural competitive discount pressure. Separately, if FII ownership continues declining below 12% over the next two quarters while promoter stake remains flat, the signal is that the earnings recovery timeline is materially longer than the 4-6 quarter window priced here.

🚨 What would change our mind. If EBITDA margin in Q1 or Q2 FY27 falls back below 13% despite the full-quarter benefit of the March-April price hikes, that invalidates the recovery thesis and suggests pricing power is insufficient against structural competitive discount pressure. Separately, if FII ownership continues declining below 12% over the next two quarters while promoter stake remains flat, the signal is that the earnings recovery timeline is materially longer than the 4-6 quarter window priced here.

🚨 Layer 1 read, 27 June 2026 — DROP. Cera's earnings curve has expanded over the decade (EPS Rs 77->191) and Q4 FY26 showed the first margin recovery (EBITDA 10.2%->15.2%) off a brass-cost trough, with faucetware demand-constrained at 106% utilization. But the 10th-percentile PE is cheap only against its own 57x bubble — absolutely it is 33x at a -38% MoS, TTM growth is sub-GDP, and management has missed four consecutive guidance targets [C011a/b, C012a/b, C013a/b, C014a/b]. Intact thesis, but contingent and not cheap, so it ranks mid-low.

What would change Layer 1’s mind. EBITDA margin in Q1 or Q2 FY27 falling back below 13% despite the full-quarter benefit of the March-April price hikes — that would invalidate the recovery thesis and show pricing power is insufficient against structural discount pressure, turning the trough into a structural step-down.

The test written in advance. Management execution gap on new brands — Management execution gap on new brands by the next result.

The test written in advance. Brass and input cost re-escalation — Brass and input cost re-escalation by the next result.

🚨 What the surface reading misses. The surface reading is: PE of 29-33x appears cheap for a branded consumer goods company with 17% EPS CAGR The research reads it further: OPM compressed to 11th percentile (13% vs 10-year mid-cycle 15.2%) means EPS is cyclically depressed; on normalised margins, the PE is at approximately the 37th percentile — below the median but not at a statistical extreme. The cheap-looking PE partly reflects a lower denominator, not exclusively a compressed multiple.

🚨 What the surface reading misses. The surface reading is: FII selling of 8pp implies institutional conviction erosion The research reads it further: The FII selling peaked through Q3 FY26 (the 10.2% EBITDA quarter) — foreign institutions exited ahead of the worst quarter and the subsequent guidance downgrades. This is retrospectively rational. DII absorption at equivalent pace shows domestic long-term capital is the bid. The institutional rotation from FII to DII typically precedes an eventual recovery as patient domestic capital accumulates and the stock re-rates when earnings confirm.

Lever 15 · Market-share gains — BUILDING. Gas supply shocks disabled Morbi-based unorganised manufacturers for 2-3 quarters; Cera's GAIL-backed supply and finished-goods inventory buffer enabled market share capture. What proves it keeps working: Morbi disruption creates organised-player share-capture window. It stops working if Morbi capacity fully restores and gas prices normalise by Q2 FY27, ending the supply advantage and reversing any volume gained from disrupted competitors.

Sources: our stock research file (27 June 2026) · quarterly results through Jun 26 · the company’s own earnings calls. The story check is re-scored every results season; the record below never changes.

Revenue Revenue is the top line: everything the company billed its customers in the period.

Cera Sanitaryware Ltd reported ₹486 Cr of revenue in the Jun 26 quarter, +19.4% year on year. That is the 3rd straight quarter of year-on-year growth. Over 10 years it has compounded at 8.4% a year. The last full year, FY26, came in at ₹2,050 Cr. The last four reported quarters add to ₹2,097 Cr.

Why this happened. Geopolitical disruptions from February 2026 cut gas supply to Morbi cluster, severely constraining unorganised sanitaryware manufacturers who lack long-term gas supply arrangements. Cera, sourcing 64% of gas from GAIL at a subsidised Rs 35.55 per cubic metre (C027), maintained production continuity. The Rs 303 crore finished-goods inventory accumulated by March (C019) provided 2-3 months of customer supply runway while Morbi operations gradually reopened. Management characterised this as an opportunity for integrated manufacturers — the 60% of sanitaryware currently outsourced to Morbi (C028) is a medium-term vulnerability, but in the disruption window it created a demand-pull advantage for…

FY26 revenue came in at ₹2,050 Cr (+7.0% on the year), capping 10 years at 8.4% compound. The latest quarter (Jun 26) printed ₹486 Cr, +19.4% year on year — the 3rd consecutive quarter of year-over-year growth.

Pace check: the last four quarters averaged +9.5% growth against the decade's 8.4% — the current year is running faster than its own long-run rate.

Acceleration check: trailing-twelve-month revenue grew +9.0% over the last 4 quarters against +6.7%/yr over the last 8 — stabilising; TTM profit −17.8% vs −6.1%/yr — rolling over.

FY26-Q4. revenue ₹624 Cr and profit ₹77 Cr as reported.

FY27-Q1. revenue ₹486 Cr and profit ₹45 Cr as reported.

Why-sources: our stock research file (27 June 2026) and the company’s own results for those quarters.

Operating margin Operating margin is what is left of every ₹100 of sales after running the business, before interest and tax. It is the cleanest read on pricing power and cost control.

Cera Sanitaryware Ltd's operating margin is 10.0% in the Jun 26 quarter, −3.0 percentage points against the same quarter a year ago. Across 12 fiscal years the operating margin has ranged 12.0% to 17.0%. The current quarter is running below every full year in that window.

Why this happened. Q4 FY26 EBITDA at 15.2% (C005) versus Q3's 10.2% (C006) represents a 500-basis-point sequential recovery in one quarter, driven by the March-April price hike flow-through to retail and initial inventory drawdown. The remaining recovery lever is trade discount normalisation — management described this as a gradual journey dependent on sustained demand — and the project pricing cascade, where March price hikes reach project customers only after a 5-6 month lag beginning Q2 FY27. If both levers execute, FY27 EBITDA guidance of 14-15% (C008) is achievable with operating leverage on 18-20% revenue growth (C007).

The latest quarter's operating margin is 10.0%, −3.0 pp against the same quarter a year ago. Across 12 fiscal years the operating margin has ranged 12.0%–17.0%.

🚨 Why the margin moved: operating margin went −2.9 pp year on year while gross margin went −5.5 pp — the loss came mostly from the gross line: input costs and pricing.

FY26-Q4. revenue ₹624 Cr and profit ₹77 Cr as reported.

FY27-Q1. revenue ₹486 Cr and profit ₹45 Cr as reported.

Why-sources: our stock research file (27 June 2026) and the company’s own results for those quarters.

Net profit Net profit is what survives every cost, interest and tax — the number EPS, dividends and book value all grow from.

Cera Sanitaryware Ltd earned ₹45.0 Cr of net profit in the Jun 26 quarter, −4.3% year on year. Full-year FY26 profit was ₹204 Cr. The 10-year compound rate is 9.4%. That is 9.3% of the quarter's revenue. The same quarter a year earlier earned ₹47.0 Cr.

Jun 26 profit was ₹45.0 Cr, −4.3% year on year. On the full year, FY26 printed ₹204 Cr (−17.1%), and the 10-year compound rate is 9.4%.

🚨 Why profit moved: revenue contributed +19.4% and the margin −3.0 pp — the quarter was revenue-led despite a thinner margin.

Pace comparison, last four quarters: profit −19.7% vs revenue +9.5%. Profit is growing slower than sales — costs are eating the growth before it reaches the bottom line.

FY26-Q4. revenue ₹624 Cr and profit ₹77 Cr as reported.

FY27-Q1. revenue ₹486 Cr and profit ₹45 Cr as reported.

Why-sources: our stock research file (27 June 2026) and the company’s own results for those quarters.

Cash flow — the router The P&L says what was earned; the cash-flow statement says what actually arrived. Operating cash flow (CFO) against profit is the cleanest lie detector in the accounts.

Over the last 3 fiscal years 81% of Cera Sanitaryware Ltd's reported profit arrived as operating cash — the cash follows the profit. In FY26 that was ₹212 Cr of operating cash against ₹204 Cr of profit. After ₹27.0 Cr of capital spending, ₹185 Cr was left as free cash.

FY26: operating cash of ₹212 Cr against reported profit of ₹204 Cr, leaving free cash of ₹185 Cr after ₹27.0 Cr of capital spending. Across the last 3 fiscal years the conversion rate is 81% of profit.

Cash-flow readings here are annual — that is the resolution our series carries, so this section moves once a year.

Why conversion sits at 81%: the cash cycle stretched 33 days between FY21 and FY26 — more of each rupee of profit waits inside the cycle before arriving.

Router verdict: no single sink dominates — the next section checks both the working-capital cycle and the capital spending.

Where the cash goes Working capital is the cash tied up between paying suppliers and getting paid: debtor days (customers owe), inventory days (stock waits), and the cash conversion cycle (the whole loop, in days of sales).

Cera Sanitaryware Ltd's cash conversion cycle runs 111 days in FY26, up from 78 days in FY21. Capital spending ran ₹154 Cr over the last 3 years. At FY26 sales of ₹2,050 Cr each day of that cycle holds about ₹5.6 Cr, so roughly ₹623 Cr sits inside the business at any moment.

Why this happened. Faucetware contributed 43% of Q4 FY26 revenue and grew 24.3% year-on-year, making it the highest-growth segment. At 106% utilization (C010), the constraint is supply, not demand. A minimal Rs 4-5 crore debottlenecking investment expands monthly capacity from 4.3 lakh to 5 lakh pieces — a 16% lift targeted for Q4 FY27 (C021). Volume guidance for FY27 is 10-12% growth with 8% price realisation (C007), and the capacity addition removes the binding constraint. This driver has 3 quarters of clear visibility.

FY26: debtors at 49 days, inventory at 139 days — roughly 4.6 months of stock waiting to sell; that is where the cash sits while it waits — for a full cycle of 111 days, looser than FY21's 78.

The full loop: cash goes out to suppliers and production on day 0; stock waits 139 days to sell; customers pay about 49 days after that; and suppliers themselves are paid at 77 days — netting out to the 111-day cycle.

In money terms: at FY26 sales of ₹2,050 Cr, each day of the cycle holds about ₹5.6 Cr — so the 111-day loop keeps roughly ₹623 Cr sitting inside the business at any moment.

On the investment side: capital spending of ₹154 Cr over the last 3 fiscal years against ₹112 Cr of depreciation — building somewhat ahead of wear-and-tear. Capital work-in-progress stands at ₹7.0 Cr (FY26) — capacity paid for but not yet earning.

The synthesis: neither the cycle nor the build-out is hoarding the cash — the machine is reasonably clean.

Return on capital Return on capital employed (ROCE) is the profit the whole business earns on all the money in it — equity and debt together. It is the single best test of whether growth creates value or just size.

Cera Sanitaryware Ltd earns a ROCE of 19% in FY26. That is up from a trough of 16% in FY21. Return on invested capital clears the cost of that capital by +13.7 percentage points, so growth here adds value rather than only size. The wiring behind it is 10.0% net margin on 1.05× asset turns.

FY26 ROCE is 19%, recovered from a FY21 trough of 16% — the full ladder below shows the fall and the climb, undoctored.

Why the return is what it is — the wiring (FY26): 10.0% net margin × 1.05× asset turns × 1.33× balance-sheet leverage ≈ 14.0% on equity. Margin does its share; leverage is modest — this is an earned return, not a borrowed one.

The capstone test — ROIC − WACC: 25.7% − 12.0% = a +13.7 pp spread. The 12.0% is a standing assumption for the cost of capital in India, not a per-stock estimate — read the sign and the size of the spread, not the decimals. A spread this wide means every rupee reinvested creates more than a rupee of value — the engine compounds.

Debt Debt-to-equity says how much of the business is funded by borrowings. Low is the safe corner; the trend matters as much as the level.

Cera Sanitaryware Ltd carries total debt of ₹47.0 Cr against shareholder equity of ₹1,472 Cr as of Mar 26, a debt-to-equity of 0.03 — effectively unlevered. On the annual view that ratio went from 0.04 in FY22 to 0.03 in FY26. The returns elsewhere on this page are therefore earned rather than borrowed.

Mar 26: total debt of ₹47.0 Cr against shareholder equity of ₹1,472 Cr — a debt-to-equity of 0.03. On the annual view, debt-to-equity went from 0.04 (FY22) to 0.03 (FY26). The returns on this page are earned, not borrowed.

Ownership Who owns the stock, quarter by quarter: promoters (the controlling owners), foreign and domestic institutions, and the public. Steady accumulation by people close to the numbers is a signal; a quiet register is also an answer.

Domestic institutions added 6.8 points of Cera Sanitaryware Ltd over 8 quarters, the biggest move on the register. That takes domestic institutions to 14.1% of the company. Foreign institutions moved −6.0 points over the same window, to 15.4%. The register is read on the four disclosed classes only; nothing is inferred between filings.

The register over the last two years — Domestic institutions: +6.8 points over 8 quarters to 14.1%; Foreign institutions: −6.0 points over 8 quarters to 15.4%; Promoters: −0.1 points over 8 quarters to 54.4%.

Why the register moved: rotation — foreign institutions −6.0 points against domestic institutions +6.8 points over 8 quarters, with promoters holding steady — one class of institutions handing the register to the other, not a verdict change by the people closest to the numbers.

Safety line The Z-score estimates how far a company sits from balance-sheet distress — above roughly 3 is safe, below roughly 1.8 is the danger zone. It was built for manufacturers, so it is not applied to banks and lenders.

Cera Sanitaryware Ltd: the Z-score is not available for this stock, so we say so rather than invent one. It is a distance-to-distress estimate from the balance sheet, not a forecast of failure. The debt, cash-flow and return sections above carry the balance-sheet evidence this page does hold, and each of them states its own reporting date.

The safety line in one sentence: the Z-score is not available for this stock, so we say so rather than invent one.

Valuation P/E is the price of ₹1 of annual profit: how many rupees the market pays for each rupee the company earns in a year.

Cera Sanitaryware Ltd trades at 34.9× P/E, mid-range by its own standards (41st percentile). Its long-run median P/E is 36.8×, measured across 10.2 years of weekly readings. This places the multiple against the stock’s own record, and says nothing about what the business is worth.

Today's P/E of 34.9× is mid-range by its own standards (41st percentile), against a long-run median of 36.8× measured over 10.2 years of weekly readings. This is a comparison against the stock's own history — not a claim about what it is worth.

Why the multiple sits where it does: over the past year annual EPS moved −17.2% against a −11.6% price move — the price outran earnings, pushing the multiple UP its own range.

The price move, decomposed: over 5y, of the +5.1%/yr price move, ~+13.3%/yr came from earnings growth and ~−8.2 pp from the multiple (compressing); over 10y, of the +8.9%/yr price move, ~+8.8%/yr came from earnings growth and ~+0.1 pp from the multiple (roughly flat). The split is the honest approximate (price return minus earnings growth); it makes the rally itself visible instead of hiding it behind the percentile.

Put together: the multiple is unremarkable against its own past, so the story rests on the earnings line underneath it, not the multiple.

What the price assumes This reading works the multiple backwards. It asks one question: what yearly rate of profit growth is a buyer at the market price already paying for? The number is the growth rate that makes eleven years of profit — six years growing, then five fading — add up to that day's market price, once each year is discounted at 11% a year.

Solved at its 28 June 2026 price, Cera Sanitaryware Ltd was paying for profit growth of about 18.8% a year. Profit itself has compounded 9.4% a year over the past 10 years. Today the market pays 34.9× P/E, the 41st percentile of its own 10-year range.

What the two numbers say together. The multiple is unremarkable against its own past, and the growth the price is paying for is far above what this company has actually delivered.

How to hold this number: it is a reading of one day's price, taken on 28 June 2026, not a running figure — every other number on this page, the multiple included, is read off the live quote as of 11 September 2026. A higher price is paying for more growth and a lower price for less, so it moves whenever the price does, and this page does not restate it between measurements.

Stage: Deteriorating Every business sits somewhere on a fundamental arc, and this page names the spot before anything else. The last twelve quarters of revenue, profit and EPS growth — plus the return the business earns on its capital — are read as curves: Deteriorating (the curves are falling), Turning around (a trough has just formed and the last few quarters lift off it), Improving (the climb off the trough is sustained), Consistent (steadily positive with healthy returns), Topping out (still high but decelerating from the peak). When the curves genuinely disagree the read is Mixed; too little history is No read. CAGR (compound annual growth rate) is the smooth yearly pace that turns the starting value into the latest one — the fairest way to compare growth across different time spans. Read the columns together: if the 1-year number towers over the 10-year, recent growth is running hotter than the long-run trend. A dash means that window is not held, or the base year was a loss (where a growth rate is not meaningful).

Cera Sanitaryware Ltd reads as deteriorating on its fundamental arc. Deteriorating — profit and EPS growth are shrinking (profit growth −17.8% latest against +24.6% at its 12-quarter best), ROCE slipping at 18.0%. The read is built from 12 quarters across 4 curves, on full evidence.

🚨 Why it matters: falling curves mean every cheap-looking ratio below needs a discount for direction.

4-Factor Sector Score

36.3/100 — rank 4 of 6 in Ceramics/Tiles/Sanitaryware · 91% evidence confidence

Cera Sanitaryware Ltd scores 36.3 out of 100 against the 6 companies it is compared with in Ceramics/Tiles/Sanitaryware, ranking 4. Balanced evidence: keep at normal research priority and require another comparable period before raising conviction.

The four contributions add to the total exactly: 6.5 + 15.9 + 5.5 + 8.4 = 36.3. This is the SAME number shown on the sector comparison — it is computed once, for the whole peer set, and read here.

What would change it: The read weakens if profit growth turns negative or margin improvement reverses while sector-relative strength deteriorates.

Said versus delivered

What Cera Sanitaryware Ltd's management promised, set against what actually arrived — 4 tracked promises on the record. Read straight from the company’s own earnings calls. A promise that slipped stays on this page after it is met.

Senator Store Rollout Target Reset · 8 August 2026. The May 2026 call said 40 Senator flagship stores were operational and targeted 60 stores by the next financial year, while the latest call describes a 35-store base and a target of only around 50 by the end of the current year. This also conflicts with the November 2025 target of 45 to 50 stores by March 2026, representing a material reduction in both the reported store base and the forward target without explanation.

EBITDA Margin Outlook Lowered · 8 August 2026. In May 2026, management indicated that EBITDA margins could be sustained at around 14% to 15%, whereas the latest call provides a 13.5% to 14% FY27 margin range. The latest call explains the Q1 margin weakness through one-time factors and references the accounting presentation change, but does not reconcile the lower full-year outlook with the prior 14% to 15% range.

🚨 Senator and PolyPlus Revenue Targets Severely Missed and FY27 Guidance Silently Halved · 9 May 2026. In the Nov 2025 call, management guided Rs. 40-45 crores from Senator and PolyPlus combined for H2 FY26 alone and separately confirmed an FY27 combined revenue target of Rs. 150 crores. The May 2026 call reveals actual FY26 full-year combined revenue of only approximately Rs. 19 crores, less than half the H2-alone guidance, while the FY27 target has been quietly reduced to Rs. 70-80 crores with no explanation offered for either the severe miss or the materially lower forward outlook.

EBITDA Margin Guidance Reduced from 15-17% Holy Grail to 14-15% · 9 May 2026. In the Aug 2025 call, management explicitly described a 15-17% EBITDA margin as a holy grail to be maintained for the next two to three years, framing it as a durable structural target. By May 2026, the guidance range has been quietly lowered to 14-15%, dropping both the lower and upper ends of that original commitment, with Q3 FY26 actual margins having deteriorated to 10.2% in the interim. No explanation was provided for why the originally stated multi-year target range is no longer considered achievable.

Every quote above is taken word for word from the company’s own earnings calls.

Frequently asked questions