Asian Paints shares fall up to 4.4% after slump in Q1 net profit

The stock fell as much as 4.4% to ₹2,842 apiece on the National Stock Exchange (NSE). However, it recovered from the day's low to trade at ₹2,913.9, down 2% at 9:42 am.

In the year-ago period, the company had posted a net profit of ₹1,550.3 crore.

Consolidated revenue from operations in the latest June quarter fell 2.3% year-on-year (YoY) to ₹8,969.73 crore as against ₹9,182.31 crore in the same period last year.

Total expenses stood at ₹7,559.04 crore, up 3.4% from ₹7,305.09 crore in the year-ago period.

"Demand conditions for the paint industry were tough, impacted by the severe heatwave and general elections in the quarter," Asian Paints Ltd Managing Director and CEO Amit Syngle said.

Despite delivering a good volume growth of 7% in the decorative segment, aided by some movement in rural markets, the company's value declined 3% due to the price decrease taken earlier in the year and the shift in product mix, he added.

On the international front, Syngle said geographies like Sri Lanka and Ethiopia grew well in Q1 due to gradual recovery in these economies. However, key macroeconomic issues prevailed in markets like Bangladesh, Egypt and Nepal, affecting the overall performance of international business.

On the outlook, Syngle said, "In the near term, we expect demand conditions to improve on the back of improving rural sentiment and monsoon picking up gradually. We remain focused on driving growth through enhanced saliency of our brand, innovation and customer-centricity."