Asian Paints Q3 results: Profit climbs 35%, meets Street estimates; management commentary, key highlights

Asian Paints Ltd on Wednesday reported a 35 per cent year-on-year (YoY) rise in consolidated net profit (after minority interest) at Rs 1,447.70 crore for the December quarter compared with Rs 1,072.70 crore in the same quarter last year. The consolidated net sales for the quarter rose 5.4 per cent to Rs 9,074.90 crore compared with Rs 8,607.50 crore in the corresponding quarter last year. the top and bottomline growth figures largely met Street expectations.

The paints maker reported a volume growth of 12 per cent and value sales of 5.5 per cent in the decorative business. Asian Paints said its industrial business saw double-digit revenue growth. Profit before depreciation, interest, tax, other income, and exceptional items (PBDIT) jumped 27.6 per cent to Rs 2,056.10 rcore from Rs 1,611.4 crore YoY. PBDIT Margin as percentage to net sales improved to 22.7 per cent from 18.7 per cent in the corresponding period of the previous year, Asian Paints said.

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International Business registered increased profitability with growth in Middle East and Africa; remained constrained by macro - economic headwinds, inflation in key markets of South Asia and Egypt, Asian Paints said.

Management commentary

"Moving forward, we will maintain focus on driving strong sales growth and continue to invest in multiple initiatives and solutions for our customers, building on our leadership position.” said Amit Syngle, Managing Director & CEO of Asian Paints.

Syngle said the quarter delivered a Decorative & Industrial coatings combined value growth of 6.1 per cent with a strong double-digit Industrial coatings value growth. The Decorative Business grew well in Luxury and Economy segments to register a robust 12  per cent volume growth and a value growth of 5.5 per cent.

"The growth was supported by the extended festive season, though we saw some moderation in demand in the latter part of the quarter. Both our Auto OE and General Industrial coating businesses achieved sturdy revenue growths and good profit margins. Our International Business saw growth in the Middle East and Africa and registered increased profitability overall," he said.

Segment highlights

International business: Sales was flat at Rs 779.10 crore from Rs 778.80 crore on the back of macro-economic headwinds, inflation in key markets of South Asia and Egypt. In constant currency terms, sales increased 5.2 per cent. PBT before exceptional items was Rs 58.30 crore against Rs 37 crore in the corresponding period of previous year.

Home Décor business: Bath Fittings business saw sales falling 5 per cent to Rs 85.4 crore from Rs 89.80 crore on the back of weak industry demand. PBDIT loss stood at Rs 5.5 crore against profit of Rs 0.1 crore in the corresponding period of the previous year.

Kitchen business saw flat sales at Rs 100.10 crore after 4 quarters of de-growth. PBDIT was Rs 4.2 crore against a loss of Rs 3.3 crore in the corresponding period of previous year.

Sales at White Teak increased 18.3 per cent to Rs 33.7 crore. Sales at Weatherseal more than doubled to Rs 13.7 crore.

Industrial business: APPPG sales increased 10.1 per cent to Rs 288 crores from Rs 261.6 crore. PBT in Q3FY24 was Rs 33.20 crore against Rs 25.6 crore in the corresponding period of previous year.

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