Asian Paints’ net up 54% despite flat revenue growth
₹1,205.4 crore for the September quarter, up 54% from ₹782.7 crore a year ago, despite flat revenue growth. Its revenue rose a mere 0.3% to ₹8,478.57 crore during the quarter under review, primarily due to sluggish demand, a delayed festive season as well as erratic monsoon rains. “Erratic monsoon impacted market sentiment potentially leading to deferment of sale to October given the late Diwali this year.
Growth in automotive and refinish business was decent. In contrast, our general industrial coatings business sustained its double-digit growth trajectory," said Amit Syngle, managing director and chief executive, Asian Paints. “Operational, formulation and sourcing efficiencies coupled with moderating raw material prices benefitted our margins in Q2 resulted in strong profit growth." The paint manufacturer’s material costs for Q2 fell from ₹4,925 crore a year ago to ₹3,918.27 crore.
The company’s earnings before interest, taxes, depreciation and amortization stood at ₹1,716.2 crore, while its operating margin was at 20.3%. Net cash at the end of Q2 was at ₹3,542.8 crore. During the quarter, the firm witnessed 6% volume growth in the decorative paint business.
It also reported sustained revenue growth in industrial business. Revenue fell 3.9% in its international business to ₹775 crore due to certain macroeconomic challenges. “Our International business, though supported by robust growth in the Middle East, and improved profitability, remained constrained by macro-economic challenges, inflation, and forex unavailability in geographies of South Asia and Egypt." Revenue for its home décor business was also suppressed during the second quarter of FY24.
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