BENGALURU (Reuters) – Berger Paints India reported first quarter profit above estimates on Friday, helped by lower tax expenses.
The company reported consolidated net profit of 3.54 billion rupees ($42.2 million) for the April-June period, largely unchanged from year ago, but above analysts’ average estimate of 3.42 billion rupees as per LSEG data.
Tax expenses fell 7.7% to 1.12 billion rupees, while discount-spurred volume growth led to revenue rising by 2% to 30.91 billion rupees.
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KEY CONTEXT
Indian paintmakers have reported a largely mixed set of earnings, as some were able to diversify into sectors beyond real estate and stave off tight competition, while others were pressured by weak prices.
Kansai Nerolac and Akzo Nobel India both reported upbeat first-quarter profits, although Asian Paints – the country’s top paintmaker – posted weaker-than-expected earnings due to competition and price cuts.
Sales value was lower due to price cuts Berger Paints took to woo buyers, and stronger sales was seen in the “high volume, low value” products in the waterproofing and construction chemicals category, CEO and Managing Director Abhijit Roy said in a release.
PEER COMPARISON
Valuation (next Estimates (next 12 Analysts’ sentiment
12 months) months)
RIC PE EV/EBITDA Revenue Profit Mean # of Stock to price Div
growth % growth % rating* analysts target** yield
(%)
Berger Paints India 47.88 29.88 8.19 4.75 SELL 20 1.05 0.68
Ltd
Asian Paints Ltd 50.06 34.19 7.54 -1.62 HOLD 35 0.96 1.19
Kansai Nerolac 31.22 19.96 6.49 25.65 HOLD 11 0.92 0.85
Paints Ltd
Akzo Nobel India 32.94 21.54 8.14 5.30 BUY 2 1.10 2.28
Ltd
* The mean of analyst ratings standardised to a scale of Strong Buy, Buy, Hold, Sell, and Strong Sell
** The ratio of the stock’s last close to analysts’ mean price target; a ratio above 1 means the stock is trading above the PT
APRIL-JUNE STOCK PERFORMANCE
— All data from LSEG
— $1 = 83.9400 Indian rupees
(Reporting by Hritam Mukherjee in Bengaluru; Editing by Varun H K)
