Asian Paints Q1FY25 results: Net profit dips by 25%, revenue also misses market estimates

India's largest paint maker Asian Paints, reported a 24.5% dip in its net profits for the quarter, pushing it down to Rs 1,170 crore from Rs 1,383 crore in the same quarter last year. The company's net sales during the quarter also dipped by over 2% to touch Rs 8,970 crore, compared to Rs 9,182.31 crore in the year-ago period.

In a statement, Amit Syngle, MD and CEO of Asian Paints attributed the below-expectation results to tough demand conditions during April-June, which also saw severe heatwaves and general elections. However, he expected the demand to pick up soon, largely on the back of improving rural sentiment and monsoon making headway in the country.

The company's international sales also took hit, down to Rs 679.1 crore from Rs 695.1 crore, mainly due to liquidity and forex crises it experienced in the key markets, namely Asia, Nepal, Bangladesh and Egypt. On the other hand, Ethiopia and Sri Lanka proved beneficial for the company's international growth during the quarter.

In June 2024, the company paid out a final dividend of Rs 28.15 per equity share to its shareholders. The company also reported a 7% volume growth during the previous quarter. But its EBITDA margin during the quarter shrunk from 23.1% in the same quarter last year to 18.1% between April-June 2024. The company's consolidated profits before depreciation, interest, tax, income and exceptional items dipped to Rs 1,694 crore, as compared to Rs 2,121 crore in the year ago period.

Bath fitting sales inch up

The only segment within the business' umbrella that registered growth was the bath fitting segment, which grew by 10%, and kitchen fittings, which jumped by 4.6%. The company's industrial business grew by 5.8% due to solid growth in auto original equipment manufacturing (OEM) and the powder coating segments.

At close of markets on Tuesday, the paint maker's stock was trading at Rs 2,968.00, up by 0.39%. Over the last year, the company's share has fallen by as much as 14.23%, but it remains a solid catch for long-term investors, jumping up by 116.78% over the last 5 years.