Asian Paints profit drops 24.5% amid weak demand & price cuts in Q1
Paint

Asian Paints profit drops 24.5% amid weak demand & price cuts in Q1

Asian Paints reported a 24.5% decline in net profit for Q1FY25, attributing the drop to weak demand resulting from general elections and severe heat waves. The country's largest paint manufacturer saw its profits fall to Rs 11.7 billion, with the decorative paints business in India experiencing a volume growth of 7%.

During the quarter, Asian Paints' net sales amounted to Rs 89.7 billion, a decrease of 2.3%. The company noted that the quarter's revenue growth was adversely impacted by price cuts implemented in the previous quarter and changes in product mix.

Profit before interest, depreciation, and tax dropped 19.7% to Rs 18.87 billion for the quarter ending in June.

Asian Paints also reported that regions such as Ethiopia and Sri Lanka experienced growth due to gradual economic recovery, while macroeconomic issues in key markets like Nepal, Bangladesh, and Egypt affected the overall performance of the international business.

"Demand conditions for the paint industry were tough, impacted by the severe heatwave and general elections in the quarter. We delivered a good volume growth of 7% in the decorative segment aided by some movement in rural markets; however, value declined by 3% due to the earlier price decrease and shift in product mix," said Amit Syngle, Managing Director and CEO, Asian Paints, in a release.

"Unexpected material price inflation coupled with supply chain challenges impacted the profitability of the decorative business for the quarter," he added.

The industrial business performed relatively better, growing by 5.8% in value, supported by strong growth in the Auto OEM and powder coatings segments. The economy segment also saw significant uptake, driven by the launch of the revolutionary latex paint NeoBharat, part of Asian Paints' strategy to penetrate the 'bottom of the pyramid' market segment.

Syngle highlighted a progressive quarter for the home d'cor segment, with growth across all categories and strong performance in its Beautiful Home Stores.

Looking ahead, Syngle expressed optimism: "In the near term, we expect demand conditions to improve with better rural sentiment and the monsoons picking up gradually. We remain focused on driving growth through enhanced brand saliency, innovation, and customer centricity."

(Source: BS)

Asian Paints reported a 24.5% decline in net profit for Q1FY25, attributing the drop to weak demand resulting from general elections and severe heat waves. The country's largest paint manufacturer saw its profits fall to Rs 11.7 billion, with the decorative paints business in India experiencing a volume growth of 7%. During the quarter, Asian Paints' net sales amounted to Rs 89.7 billion, a decrease of 2.3%. The company noted that the quarter's revenue growth was adversely impacted by price cuts implemented in the previous quarter and changes in product mix. Profit before interest, depreciation, and tax dropped 19.7% to Rs 18.87 billion for the quarter ending in June. Asian Paints also reported that regions such as Ethiopia and Sri Lanka experienced growth due to gradual economic recovery, while macroeconomic issues in key markets like Nepal, Bangladesh, and Egypt affected the overall performance of the international business. Demand conditions for the paint industry were tough, impacted by the severe heatwave and general elections in the quarter. We delivered a good volume growth of 7% in the decorative segment aided by some movement in rural markets; however, value declined by 3% due to the earlier price decrease and shift in product mix, said Amit Syngle, Managing Director and CEO, Asian Paints, in a release. Unexpected material price inflation coupled with supply chain challenges impacted the profitability of the decorative business for the quarter, he added. The industrial business performed relatively better, growing by 5.8% in value, supported by strong growth in the Auto OEM and powder coatings segments. The economy segment also saw significant uptake, driven by the launch of the revolutionary latex paint NeoBharat, part of Asian Paints' strategy to penetrate the 'bottom of the pyramid' market segment. Syngle highlighted a progressive quarter for the home d'cor segment, with growth across all categories and strong performance in its Beautiful Home Stores. Looking ahead, Syngle expressed optimism: In the near term, we expect demand conditions to improve with better rural sentiment and the monsoons picking up gradually. We remain focused on driving growth through enhanced brand saliency, innovation, and customer centricity. (Source: BS)

Next Story
Infrastructure Transport

Adani Airports Raises $1 Billion for Mumbai Airport Expansion

Adani Airports Holdings (AAHL), a wholly owned subsidiary of Adani Enterprises and India’s largest private airport operator, has successfully secured $1 billion financing through a project finance structure for its Mumbai International Airport (MIAL). The transaction involves issuance of $750 million notes maturing July 2029 (“Notes”) which shall be used for refinancing. The financing structure also includes provision to raise an additional $250 million, resulting in total financing of $1 billion. This framework will provide enhanced financial flexibility for the capital expenditure prog..

Next Story
Infrastructure Urban

Delhivery Expands Gateway Hub to Enhance Capacity

Delhivery, India's largest fully integrated logistics service provider, today announced the expansion of its Chandigarh Gateway Hub. The facility, spread across 2.35 lakh sq ft will accelerate the region’s economic growth and create thousands of direct and indirect work opportunities. It will also empower thousands of businesses in the region, enabling them with access to nationwide markets through improved inventory storage and order fulfillment capabilities."Chandigarh and its surrounding region remain a core market for us. This expansion directly addresses the needs of local businesses, e..

Next Story
Real Estate

Arihant Buys Land in Chennai IT Hub for Rs 12 Bn Housing Project

Chennai-based real estate developer Arihant Foundations & Housing has acquired a prominent 3-acre land parcel on MGR Salai, Perungudi, at the gateway to the city's rapidly growing IT corridor along Old Mahabalipuram Road (OMR). The company plans to develop a premium residential project on the site, with a proposed built-up area of 0.7 million square feet and an estimated Gross Development Value (GDV) of Rs 12 billion.The project is currently awaiting final regulatory approvals before its official launch. Arihant is expected to announce the construction timeline in the coming months.Located..

Advertisement

Advertisement

Subscribe to Our Newsletter

Get daily newsletters around different themes from Construction world.

STAY CONNECTED

Advertisement

Advertisement

Advertisement

Advertisement

Talk to us?