Asian Paints on Tuesday posted fiscal first quarter profit at Rs 1,574.84 crore, up 52 per cent in comparison to Rs 1,036.03 crore during the corresponding quarter of last year, surpassing estimates. It posted revenue from operations at Rs 9,182.31 crore, up 6.7 per cent as against Rs 8,606.94 crore during the first quarter of FY23. The company EBITDA stood at Rs 2,121.2 crore. Asian Paints recorded total income of Rs 9,379.38 crore during the quarter in review, up 7.7 per cent against Rs 8,705.91 crore during Q1FY23. However, total expenses during the first quarter of FY24 was at Rs 7,305.09 from Rs 7,287.84 crore a year ago.
Asian Paints’ performance across business verticals
Asian Paints posted a double digit volume and healthy value growth in decorative business in India. The home decor business benefited from a high growth trajectory in fabrics, decorative lighting, UPVC windows and doors, while the company is focused on scaling up the Kitchen & Bath business.
In the bath fittings business, sales decreased by 28.2 per cent to Rs 84.7 crore from Rs 118.0 crore on the back of high base in the last year due to price increases. Sales in kitchen business decreased by 12 per cent to Rs 96 crore from Rs 109 crore on the back of high base in the last year due to price increases. Sales at White Teak increased by 28.4 per cent to Rs 26 crore and sales at Weatherseal more than doubled to Rs 9.8 crore. Asian Paints also sustained a double-digit revenue growth trajectory in industrial business. “Our Domestic Decorative business registered double digit volume growth and a relatively healthy value growth, coming on a high base of the previous year. Both the Auto OE and the General Industrial coating businesses achieved a strong double‐digit revenue growth, led by growth in the protective & powder coatings segment,” said Amit Syngle, Managing Director & CEO, Asian Paints Limited
In terms of international business, sales decreased by 1.4 per cent to Rs 695.1 crore from Rs 705.2 crore on the back of economic uncertainty, forex crisis and liquidity issues in key markets of Asia and Africa. “Our international business was supported by good deliveries from the Middle East region; however, continued macro‐economic challenges and adverse forex conditions in Asian markets, resulted in an overall subdued growth for the international portfolio,” said Amit Syngle.
Experts on Asian Paints’ Q1 performance
Reacting on growth numbers by Asian Paints, Amnish Aggarwal, Head of Research, Prabhudas Lilladher Pvt Ltd, said, “Volumes witnessed a strong growth YoY coming on a high base of the previous year. Margin expanded by ~500 bps aided by strong operational efforts and supported by easing inflation in raw material prices. We believe that the coming festive season coupled with easing RM inflation will lead to healthy growth.”
Going forward, said Anushi Vakharia, Research Analyst, StoxBox, “Our focus does not only pertain to the company-specific actions/events but will closely watch the overall change in the paint industry dynamics with the entry of new players in the market. Hence, going forward, we will closely track any change in the company’s strategy to tackle the evolving competitive landscape.”