India's Asian Paints slumps after Q2 volume growth disappoints (updated)

Berger Paints India

11/11/2024 04:20

(Updates with more details from analyst notes, adds broader
market levels, background)
       Nov 11 (Reuters) - 
    Asian Paints'  ASPN.NS  shares slumped on Monday, after the
Indian paintmaker reported a second-quarter net profit on
Saturday that nearly halved and a volume growth that
disappointed some analysts.
    The stock fell as much as 9.3% on the day and was the top
percentage loser on the benchmark Nifty 50  .NSEI , which was
down 0.3%. 
    Asian Paints' sales volumes, which declined 0.5%, were
weaker than those of other large peers such as Berger Paints'
 BRGR.NS  3.6% rise and Kansai Nerolac's  KANE.NS  4% overall
volume growth, said Morgan Stanley.
    Product mix, rising rebates... and high selling expenses are
key monitorables for Asian Paints, the brokerage added.
        The paintmaker is India's largest in terms of market
share.
  
        In the reported quarter, the company's 5% decline in
sales value came below estimates, Macquarie said. Comparatively,
Berger's was largely flattish and Kansai posted a 5% drop, the
brokerage added. 
  
    Asian Paints had flagged weak demand for its premium
products in the previous quarters, as inflation-hit shoppers
chose cheaper alternatives and intensifying competition in the
sector forced players to cut prices. 
        
  

 (Reporting by Hritam Mukherjee in Bengaluru; Editing by Janane
Venkatraman)
 ((Hritam.Mukherjee@thomsonreuters.com; X: @MukherjeeHritam;))