Asian Paints stock price dropped over 3 percent on National Stock Exchange in Thursday’s session on missing profit and revenue estimates. The paint-making company on January 19 posted a 6.37 percent increase in consolidated net profit for the third quarter that ended on December 31, 2022, at Rs 1,097.06 crore.
During the same quarter a year ago, net profit stood at Rs 1,031.29 crore. Despite the growth, the numbers failed to beat the market estimate of an 8.7 percent increase to Rs 1,104 crore from a year, per the analysts polled by Moneycontrol.
Consolidated revenue from operations clocked Rs 8,636.74 crore in Q3FY23, 1.28 percent higher than Rs 8,527.24 crore a year ago, lower than the estimated growth of 10.9 percent YoY to Rs 9,456 crore.
“The domestic Decorative Business registered a flat volume and value sales delivery for the quarter, on a very high price increase base in the previous year,” said Amit Syngle, Managing Director & CEO of Asian Paints.
“The extended monsoon in October also affected retailing in the peak festival season, but demand picked up in November and December leading to a double-digit growth for the Decorative Business in December.”
The company remarked that industrial business performed well due to robust growth in the Auto OE and general industrial segments.
International business registered a mixed response where the Middle East and Africa witnessed vigorous growth, and the South Asia market, especially Sri Lanka and Bangladesh got hit by the adverse forex and macro-economic conditions.
Asian Paints Q3FY23 Segment-Wise Revenue:
International business sales saw a 2.1 percent inch up to Rs 778.82 crores from Rs 762.43 crore. In constant currency terms, it rose 13.4 percent.
In the home décor segment, sales for bath fittings dropped 10.9 percent to Rs 89.84 crores from Rs 100.84 crore YoY.
Sales in the kitchen business tumbled 7.1 percent to Rs 100.68 crore from Rs 108.41 crore YoY.
In the industrial business: APPPG sales increased 23.9 percent to Rs 261.63 crore from Rs 211.17 crore.
The firm said its Profit before depreciation, interest, tax, and other income (PBDIT) margin stood at 18.7 percent for the quarter ended.
“The operating margins improved strongly on a sequential basis as well as saw an improvement on a y-o-y basis driven by deflation in some of the raw material prices as well as continued work on driving operational efficiencies across businesses,” said Syngle.
The Asian Paints stock price closed 3.12 percent down at Rs 2,853.40.