Paint prices may fall only after Diwali: Asian Paints, Berger Paints, Indigo price targets
Birla Opus has implemented price hikes that are higher than those of several established peers, suggesting that the industry may be able to retain at least part of the benefit from lower input costs despite the more competitive landscape.
- Jun 30, 2026,
- Updated Jun 30, 2026 12:07 PM IST
With US and Iran on table for peace talks, brent crude prices have fallen 15.52% in a month. This correction in crude oil prices bodes well for the Indian paints industry. The paints sector uses petroleum derivatives, which accounts for 55-60% of all raw material costs used to manufacture paint. Items such as resins, solvents, binders, and additives are all processed from crude oil.
Most paint manufacturers implemented cumulative price hikes of 14%–16% between March and June 2026 when crude prices were on the boil due to the US-Iran war. But crude oil prices corrected during June. Since crude oil and its derivatives are among the industry's key input costs, the fall is expected to provide a meaningful boost to margins.
But this may not be a good news for consumers.
According to a report by ICICI Securities, paint companies are likely to maintain current prices through the festive demand season and defer any price reductions until after Diwali. At the same time, spending on dealer incentives and trade schemes could increase during the July–September quarter to drive market share gains.
The report further mentions that India's paint industry appears to be entering a favourable phase, with companies benefiting from recent price hikes even as key raw material costs begin to ease. Historically, paint companies have passed on a portion of lower raw material costs to consumers through price reductions. However, past trends suggest these price cuts are neither immediate nor proportionate to the decline in input costs, the brokerage said.
Paint makers have typically announced price reductions three to four months after commodity prices begin falling, allowing them to enjoy higher profitability for an interim period. In addition, the magnitude of price cuts has generally been modest, often amounting to less than half of the cumulative price increases implemented in previous quarters.
Another important trend is that companies have used part of the savings from lower raw material costs to strengthen their market position rather than passing on the entire benefit to consumers. The additional margin has often been redirected towards higher spending on dealers, influencers, painters and trade incentives to support sales growth and improve distribution.
Meanwhile, the brokerage maintained its add call on Asian Paints (Target price: Rs 3050), Berger Paints (Price target: Rs 550), Kansai Nerolac (Price target: Rs 230) and JSW Dulux (Price target Rs 3350).
On the other hand, the brokerage has a buy call on Indigo Paints with a price target of Rs 1200.
Although competition in the industry has intensified significantly compared with the 2000–2020 period, pricing behaviour remains encouraging. Birla Opus has implemented price hikes that are higher than those of several established peers, suggesting that the industry may be able to retain at least part of the benefit from lower input costs despite the more competitive landscape.
The report mentions that any price cut before the Diwali season or a reduction exceeding 7% during calendar year 2026 could disappoint investors as the market currently expects companies to preserve margins for longer.
With US and Iran on table for peace talks, brent crude prices have fallen 15.52% in a month. This correction in crude oil prices bodes well for the Indian paints industry. The paints sector uses petroleum derivatives, which accounts for 55-60% of all raw material costs used to manufacture paint. Items such as resins, solvents, binders, and additives are all processed from crude oil.
Most paint manufacturers implemented cumulative price hikes of 14%–16% between March and June 2026 when crude prices were on the boil due to the US-Iran war. But crude oil prices corrected during June. Since crude oil and its derivatives are among the industry's key input costs, the fall is expected to provide a meaningful boost to margins.
But this may not be a good news for consumers.
According to a report by ICICI Securities, paint companies are likely to maintain current prices through the festive demand season and defer any price reductions until after Diwali. At the same time, spending on dealer incentives and trade schemes could increase during the July–September quarter to drive market share gains.
The report further mentions that India's paint industry appears to be entering a favourable phase, with companies benefiting from recent price hikes even as key raw material costs begin to ease. Historically, paint companies have passed on a portion of lower raw material costs to consumers through price reductions. However, past trends suggest these price cuts are neither immediate nor proportionate to the decline in input costs, the brokerage said.
Paint makers have typically announced price reductions three to four months after commodity prices begin falling, allowing them to enjoy higher profitability for an interim period. In addition, the magnitude of price cuts has generally been modest, often amounting to less than half of the cumulative price increases implemented in previous quarters.
Another important trend is that companies have used part of the savings from lower raw material costs to strengthen their market position rather than passing on the entire benefit to consumers. The additional margin has often been redirected towards higher spending on dealers, influencers, painters and trade incentives to support sales growth and improve distribution.
Meanwhile, the brokerage maintained its add call on Asian Paints (Target price: Rs 3050), Berger Paints (Price target: Rs 550), Kansai Nerolac (Price target: Rs 230) and JSW Dulux (Price target Rs 3350).
On the other hand, the brokerage has a buy call on Indigo Paints with a price target of Rs 1200.
Although competition in the industry has intensified significantly compared with the 2000–2020 period, pricing behaviour remains encouraging. Birla Opus has implemented price hikes that are higher than those of several established peers, suggesting that the industry may be able to retain at least part of the benefit from lower input costs despite the more competitive landscape.
The report mentions that any price cut before the Diwali season or a reduction exceeding 7% during calendar year 2026 could disappoint investors as the market currently expects companies to preserve margins for longer.