July 17, 2024
New Delhi, India
Asian Paints Q1 Results
Asian Paints reported a significant decline in its first-quarter net profit for the fiscal year 2024-25 (FY25), falling 25% year-on-year to Rs 1,170 crore. The company’s revenue also missed estimates, dropping by 2.3% amid challenging demand conditions and economic uncertainties.
Q1 Financial Performance: Asian Paints’ Q1 FY25 net profit stood at Rs 1,170 crore, down from Rs 1,574.84 crore in the same quarter of the previous year. Revenue from operations decreased to Rs 8,969.73 crore, a 2.3% decline compared to Rs 9,182.31 crore in Q1 FY24. The company’s EBITDA was recorded at Rs 1,693.7 crore.
Impact of Demand Conditions: Managing Director and CEO Amit Syngle attributed the weak performance to tough demand conditions impacted by a severe heatwave and general elections. Despite a 7% volume growth in the decorative segment, overall value declined by 3% due to earlier price reductions and a shift in product mix.
International Business Performance: Asian Paints’ international business also faced challenges, with sales decreasing by 2.3% to Rs 679.1 crore from Rs 695.1 crore. Economic uncertainties, forex crises, and liquidity issues in key markets like Asia and Egypt contributed to this decline. In constant currency terms, however, sales saw a slight increase of 1.8%.
Home Decor and Industrial Segments: The home decor business showed mixed results. The bath fittings segment saw a sales increase of 10.3% to Rs 93.4 crore, while the kitchen business posted a 4.6% growth to Rs 100.4 crore. Recent acquisitions such as White Teak and Weatherseal also performed well, with sales increases of 14.3% and 17.6%, respectively. Meanwhile, the industrial business recorded flat sales for APPPG, though PPGAP sales rose by 9.6% to Rs 517.1 crore.
Outlook: Looking ahead, Syngle expressed optimism about improving demand conditions driven by better rural sentiment and favorable monsoon progress. The company plans to focus on brand enhancement, innovation, and customer centricity to drive growth.
Bottom Line:
Asian Paints faced a challenging first quarter in FY25, with significant drops in both net profit and revenue. While domestic and international market conditions posed difficulties, the company remains hopeful for an improved outlook in the coming quarters.
Disclaimer:
CurrencyVeda provides this news article for informational purposes only. We do not offer investment advice or recommendations. Before making any investment decisions, please conduct thorough research, consult with financial experts, and carefully consider your financial situation, risk tolerance, and investment goals. Investing in the stock market carries risks, and it’s essential to make informed choices based on your individual circumstances. CurrencyVeda is not liable for any actions taken based on the information provided in this article.
