India’s largest paint company, Asian Paints posted its September quarter (Q2FY22) results on Thursday, 21 October 2021.
The company’s consolidated revenues (topline) stood at ₹7,096 crore, up 32% year-on-year. Due to increasing raw material prices, the company’s operating margins were negatively impacted and stood at ₹904 crore, down 28%. Its consolidated net profit also went down 28% year-on-year and stood at ₹595 crore.
The Domestic Decorative Paints business showed a strong growth of 34% year-on-year, which boosted the overall revenues of the company.
The Home Improvement segment also showed significant growth and posted its highest ever revenues in this quarter.
On one hand, the company showed a strong revenue growth and, on the other hand, the company’s margins were impacted on account of steep rise in raw material prices.
In order to mitigate the persistently high raw material costs, the company said there will be price hikes going forward, and the management is confident of improvement in the performance in the December quarter.
In the current financial year, the company's share price has risen by 18%. On the other hand, the Nifty50 index has risen by almost 24%, which shows that Asian Paints has underperformed the Nifty50.