SHAPED BY OPTIMISM
Beyond Market|March 2023
Demographics and lower per capita consumption support the Wood Panel industry, but long-term fundamentals of muted demand and increasing competitive intensity are near-term headwinds
SHAPED BY OPTIMISM

The Indian wood panel industry, being ancillary to the real estate sector, has performed poorly recently. A slowdown in the real estate sector due to high-interest rates and lower discretionary spending toward home renovation - a direct consequence of high retail inflation - has hurt demand. Profitability on the other hand has suffered due to high raw material prices and cheaper imports, making it difficult for domestic players to hike prices.

The pain in the sector is evident from the financial results reported by listed companies for the just-ended October-December period. Both revenue and profits have been muted. The stocks have echoed negative sentiments on the bourses following unexciting views from company managements.

Around same time last year, the wood panel industry had enjoyed a lot of investor attention. Coming out of the Covid pandemic, the sector was witnessing a strong revival led by pent-up demand from the real estate sector and renovation activities by households. Demand was also aided by higher exports.

But with global shipping costs sharply down, the wood panel industry is now facing competitive pressure from imports. Higher imports come at a time when the domestic real estate sector is facing a slowdown, thereby impacting demand. While the demand side remains weak, competition from cheaper imports and high timber prices are impacting margins of the wood panel sector.

Broadly, the sector comprises of four segments - plywood, medium-density fibreboard (MDF), particle boards and laminates. The difference between the first three segments lies in their manufacturing process and their end use in furniture-making; laminate uses kraft paper and is mostly used for decorative purposes.

Denne historien er fra March 2023-utgaven av Beyond Market.

Start din 7-dagers gratis prøveperiode på Magzter GOLD for å få tilgang til tusenvis av utvalgte premiumhistorier og 9000+ magasiner og aviser.

Denne historien er fra March 2023-utgaven av Beyond Market.

Start din 7-dagers gratis prøveperiode på Magzter GOLD for å få tilgang til tusenvis av utvalgte premiumhistorier og 9000+ magasiner og aviser.

FLERE HISTORIER FRA BEYOND MARKETSe alt
PRUDENT PRACTICES
Beyond Market

PRUDENT PRACTICES

Banks worldwide navigate a complex balancing act, steering economies toward growth while safeguarding financial stability through thoughtful management of interest rates and credit risks

time-read
6 mins  |
August 2024
RETAIN ROULETTE
Beyond Market

RETAIN ROULETTE

Inexperienced investors spin the market wheel, chasing dizzying valuations and risking a bubble burst

time-read
5 mins  |
August 2024
UNRAVELED THREADS
Beyond Market

UNRAVELED THREADS

Bangladesh's crisis disrupts global textiles, offering India a potential opportunity, but production constraints limit its gains

time-read
4 mins  |
August 2024
PASSING THE BATON
Beyond Market

PASSING THE BATON

Succession planning helps ensure uninterrupted leadership

time-read
4 mins  |
August 2024
RISKY BUSINESS?
Beyond Market

RISKY BUSINESS?

SEBI's efforts to protect retail investors from derivatives market risks could inadvertently dampen market volumes

time-read
5 mins  |
August 2024
INFLATION-PROOF YOUR CHILD'S FUTURE
Beyond Market

INFLATION-PROOF YOUR CHILD'S FUTURE

Inflation might be stealing your child's future, but children's mutual funds can be their superhero

time-read
6 mins  |
August 2024
EMBRACE UNCERTAINTY, SAYS MARKS
Beyond Market

EMBRACE UNCERTAINTY, SAYS MARKS

Howard Marks urges investors to embrace uncertainty, long-term thinking, and focus on controllables, shunning in his memo “The Folly of Certainty”

time-read
7 mins  |
August 2024
IMPORTANT JARGON
Beyond Market

IMPORTANT JARGON

70% OF INDIVIDUAL INTRADAY TRADERS IN THE EQUITY CASH SEGMENT MAKE LOSSES, FINDS SEBI STUDY

time-read
4 mins  |
August 2024
AN ASCENT T'O NEW HEIGHTS
Beyond Market

AN ASCENT T'O NEW HEIGHTS

The IMF predicts India's economy to reach 55 trillion by 2047, driven by various economic indicators showing positive growth and government initiatives

time-read
5 mins  |
August 2024
CARRY TRADE CRASH: GLOBAL MARKETS REEL
Beyond Market

CARRY TRADE CRASH: GLOBAL MARKETS REEL

Japan’s Policy Shift Sends Shockwaves Through Global Markets, Including India, as Yen Carry Trade Disintegrates

time-read
4 mins  |
August 2024