Asian Paints on Thursday posted profit for the quarter ended September 2023 at Rs 1,232.39 crore, up 53.3 per cent in comparison to Rs 803.83 crore during the corresponding quarter of last year, marginally higher from the estimates. It posted revenue from operations at Rs 8,451.93 crore, up 0.3 per cent as against Rs 8,430.60 crore during the second quarter of FY23. The company EBITDA stood at Rs 1,717 crore. According to a CNBC TV18 poll, Asian Paints was expected to post Q2 profit at Rs 1,230 crore and revenue at Rs 8,900 crore.
The company also announced an interim dividend of Rs 5.15 per equity share of the face value of Re 1 each for the financial year ending March 31, 2024. “The record date for the purpose of determining the entitlement of the shareholders for interim dividend has been fixed as Friday, 3rd November 2023, and the dividend will be paid to the shareholders on or after Monday, 13th November 2023,” the company said in a regulatory filing.
“Operational, formulation and sourcing efficiencies coupled with moderating raw material prices benefitted our margins in Q2 and resulted in strong profit growth for the quarter. Looking towards the second half of the year, we remain optimistic about improved demand conditions well supported by the longer festive season and the overall buoyant domestic economic growth.” said Amit Syngle, Managing Director & CEO, Asian Paints Limited.
Asian Paints’ Q2 performance across business verticals
The company’s international business recorded sales at Rs 775.0 crore, down 3.9 per cent from Rs 806 crore on the back of macro-economic and forex challenges in key markets of South Asia and Egypt. In constant currency terms, sales increased by 1.9 per cent. PBT before exceptional items in Q2FY24 was Rs 40.4 crore as against Rs 43.5 crore in the corresponding period of previous year.
In terms of home décor business, bath fittings business sales decreased in Q2FY24 by 20 per cent to Rs 81.4 crore from Rs 101.8 croreon the back of weak consumer sentiment. Sales in kitchen business decreased in Q2FY24 by 17.9 per cent to Rs 96.8 crore from Rs 117.8 crore on the back of weak consumer sentiment. The business achieved PBDIT break-even with PBDIT of Rs 0.9 crore in Q2FY24 as against a loss of Rs 0.9 crore in the corresponding period of previous year. Sales at White Teak in Q2FY24 increased by 8.5 per cent to Rs 26.1 crore and sales at Weatherseal almost doubled to Rs 12.6 crore. Both these recent acquisitions are gaining from synergies with the Asian Paints network, the company said.
Under the industrial business vertical, APPPG sales increased in Q2FY24 by 11.4 per cent to Rs 250.6 crore from Rs 225.0 crore. PBT in Q2FY24 was Rs 28.4 crore. PPGAP sales, meanwhile, increased in Q2FY24 by 5.6 per cent to Rs 495.3 crore from Rs 468.9 crores.
“The domestic coatings business, decorative and industrial combined, registered a subdued 1.1 per cent revenue growth in the quarter. The Domestic Decorative Paint business for Q2 was muted, registering a flat value sale with a 6 per cent volume growth. The erratic monsoon impacted market sentiment potentially leading to deferment of sales to October given the late Diwali this year. Growth in our Automotive & Refinish business was decent, while our General Industrial Coatings business sustained its double-digit growth trajectory,” said Amit Syngle.
“Our International Business, though supported by robust growth in the Middle East and an overall improved profitability, remained constrained by macro-economic challenges, inflation and forex unavailability in key geographies of South Asia and Egypt. While demand in the Home Décor space was soft on account of muted consumer sentiments, we continued to strengthen our décor foray with new collections, network and store expansions,” he added.
Furthermore, the company board also approved appointment of Soumitra Bhattacharya as an Additional and Independent Director of the Company for a period of five years with effect from October 26, 2023 to October 25, 2028.
