The company saw top-line expansion driven by strong decorative paint volumes, even as rising raw material costs forced operating margins down to 15.6%. Management initially absorbed cost shocks to defend consumer demand before initiating staggered price revisions across coatings portfolios. Along with these pricing actions, the firm announced a dividend of Rs 5.75 per share as its stock recorded modest gains on the BSE. Moving forward, the business will rely on product innovation and seasonal demand to counter sustained supply chain volatility.
Key points
Profit before depreciation, interest, tax and other income margin declined to 15.6% due t…: Profit before depreciation, interest, tax and other income margin declined to 15.6% due to raw material inflation.
Management is implementing staggered price hikes across coatings segments to counteract g…: Management is implementing staggered price hikes across coatings segments to counteract geopolitical supply disruptions.
The firm intends to leverage festive and wedding season demand while maintaining calibrat…: The firm intends to leverage festive and wedding season demand while maintaining calibrated pricing to sustain growth.
Sources checked by our analysis pipeline: 1
During the quarter, the company recorded 6.4% volume growth and 14.5% value growth in its decorative paints business.
The company’s bottom line for the quarter rose to Rs 1,067.6 crore from Rs 993.6 crore a year ago, while consolidated net sales grew to Rs 9,953.9 crore from Rs 8,513.7 crore.
Profit before depreciation, interest, tax and other income (PBDIT) rose by 3.6% to Rs 1,557.1 crore from Rs 1,503.4 crore a year ago. PBDIT margin as a percentage of net sales fell to 15.6%, down from 17.7% in the same quarter last year.
“We delivered a resilient performance in Q2, a seasonally softer quarter, sustaining the momentum of the last few quarters,” chief executive officer Amit Syngle said. “The operating environment this year has been marked by sharp raw material inflation and material availability constraints driven by geopolitical disruptions, the full impact of which was felt in Q2,” he said.
While the company calibrated price increases and absorbed a part of the cost inflation to protect consumer demand, it said it will now be increasing prices in certain segments again.
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