(Reuters) – India’s Pidilite Industries on Wednesday reported third-quarter profit below estimates, due to weak urban and rural demand for adhesives and sealants.
The company reported a consolidated net profit of 5.52 billion rupees ($64 million) for the three months ended Dec. 31, compared to analysts’ expectation of 5.91 billion rupees, according to data compiled by LSEG.
Construction-related demand remained subdued across India due to pollution restrictions, a lack of new infrastructure projects and delayed spending, analysts had noted.
The adhesives and sealants maker, known for brands such as Fevicol and Dr. Fixit, reported a 7.6% increase in revenue to 33.69 billion rupees, missing expectations of 33.99 billion rupees.
Revenue in the consumer and bazaar segment, which accounts for about 80% of Pidilite’s revenue, grew 5.2%, while the business-to-business segment rose about 19%.
“Despite subdued demand across urban and rural geographies, we continued to make steady progress, with robust revenue and underlying volume growth and healthy levels of profitability,” the company’s Managing Director Bharat Puri said in an earnings release.
Pidilite’s earnings before interest, taxes, depreciation, and amortization grew 8% from a year ago, while sales volumes rose 9.7%.
The company said it is cautiously optimistic on improved demand conditions as a result of the good monsoon and increased construction activities.
($1 = 86.3510 Indian rupees)
(Reporting by Yagnoseni Das in Bengaluru; Editing by Varun H K)
