Berger Paints India beats Q1 view on robust demand, lower material costs

Berger Paints India

09/08/2023 11:52

Aug 9 (Reuters) - Berger Paints India  BRGR.NS  on
Wednesday reported a bigger-than-expected 40% rise in profit,
aided by robust demand for decorative paints and easing raw
material costs.
    The paintmaker's consolidated net profit rose to 3.54
billion rupees ($42.76 million) for the quarter ended June 30
from 2.53 billion rupees a year earlier.
    Analysts, on average, had estimated a profit of 3.29 billion
rupees, according to Refinitiv IBES.
    Berger's cost of raw materials consumed fell 9% in the
quarter helped by a drop in crude prices. Crude is a key raw
material for paintmakers and comprises about 30% of their input
costs.
    The company said its decorative segment delivered 11.4%
growth during the quarter and its waterproofing and protective
divisions also saw robust growth.
    Revenue from operations climbed nearly 10% to 30.3 billion
rupees.
    Berger expects "to end the year with double-digit revenue
growth as demand outlook remains good on the back of positive
monsoon progress, infrastructure spends and extended festive
season," it said in a statement.
    The company is, however, likely to face stiff competition in
the coming quarters, with Pidilite Industries  PIDI.NS  and J.K.
Cement  JKCE.NS  preparing to foray into the space. Grasim
Industries  GRAS.NS  is also on track to launch its paint
business this year.
    Its peers Kansai Nerolac  KANE.NS , Indigo Paints  INDG.NS 
and Asian Paints  ASPN.NS  also reported a rise in first-quarter
profit.
    Additionally, Berger also approved a bonus issue of shares
in a ratio of 1:5.


($1 = 82.7920 Indian rupees)

 (Reporting by Ashna Teresa Britto; editing by Eileen Soreng)
 ((AshnaTeresa.Britto@thomsonreuters.com;))