Asian Paints Ltd., India’s largest paints company, has announced a notable 10% volume growth for its decorative business, surpassing the upper end of market expectations. However, despite this positive performance, the company’s stock faced a decline of up to 4% due to other parameters missing estimates.
For the quarter, revenue stood at ₹8,731 crore, marking a 0.6% decline compared to the same period last year and falling short of the estimated ₹9,050 crore. The company attributed this revenue decline to weak demand conditions and observed downtrading in the premium segment, where customers opt for cheaper alternatives.
MD & CEO Amit Syngle expressed confidence in a potential rebound in demand conditions, particularly with a favorable monsoon forecast on the horizon.
Net profit for the quarter amounted to ₹1,275 crore, below the CNBC-TV18 poll estimate of ₹1,370 crore. Similarly, the Earnings Before Interest, Tax, Depreciation, and Amortization (EBITDA) of ₹1,692 crore missed the estimated ₹1,950 crore, reflecting a 9.3% drop year-on-year. The EBITDA margin narrowed by 170 basis points to 19.4%, below the estimated 21.5%.
The coatings business in India experienced a 0.7% revenue decline during the March quarter. However, the Automotive coatings segment achieved a significant milestone by crossing ₹2,000 crore in revenue for the financial year 2024.
Despite challenges in certain markets, Asian Paints’ international business showed steady growth in the Middle Eastern and African regions. However, macro-economic headwinds in South Asia and Egypt constrained overall performance in this segment, according to the company.
