Asian Paints Q2 Results, Profit Dives 30.5%: Asian Paints Share Price Falls 9%

Asian Paints Q2 results FY25 disclosed a 30.5% year-on-year fall in the consolidated PAT (excluding exceptional items). On the Asian Paints results date which was November 9, 2024, the Asian Paints share price was at ₹2,769.45. On November 11, 2024, Asian Paints share price opened at ₹2,565.05.

Asian Paints Q2 Results FY25: Key Highlights

• Asian Paints Q2 results pointed out that consolidated net profit (after minority interest) fell to ₹694.64 crores in Q2 FY25 as against ₹1,205.42 crores reported in Q2 FY24.
• Revenue from operations stood at ₹8,003.02 crore in Q2 FY25, down 5.31% from ₹8,451.93 crore recorded in the corresponding quarter previous year.
• PBDIT (before share in profit of associates) decreased by 27.8% to ₹1,239.5 crores in Q2 FY25 from ₹1,716.2 crores recorded in Q2 FY24.
• The PBDIT margin as a percentage of net sales decreased to 15.5%, compared to 20.3% in the same period of the previous year.
• In the Asian Paints results​, the firm reported exceptional items of ₹180.14 crores during the quarter. This amount includes an impairment provision of ₹124 crores on ‘Goodwill on Consolidation’ related to White Teak, as well as a foreign exchange loss of ₹56.1 crores associated with the company’s subsidiary in Ethiopia.
• Asian Paints share price generated negative returns of 8.99% in the last 1 day as on November 11, 2024 (at 13:58).

Asian Paints Q2 Results: Segment Performance

• International business sales decreased marginally to ₹769.5 crores in Q2 FY25, compared to ₹775 crores recorded in Q2 FY24. The decline was primarily attributed to macroeconomic challenges and currency devaluation in Ethiopia, Egypt and Bangladesh as mentioned in the Asian Paints results.
• Asian Paints Q2 segment’s bath Fittings business sales were at ₹83.1 crores (up 2.1% YoY) while Kitchen business sales stood at ₹105.3 crores (up 8.8% YoY). Sales at White Teak increased by 19.2% YoY to ₹31.1 crores in Q2 FY25. Similarly, sales at Weatherseal grew by 4.8% YoY to ₹13.2 crores in the same quarter.
• Industrial business (Asian Paints PPG) sales grew by 6% YoY to ₹265.5 crores in Q2 FY25 from ₹250.6 crores recorded in Q2 FY24. Additionally, PPGAP sales increased by 5.9% YoY to ₹524.4 crores in Q2 FY25 from ₹495.3 crores posted in Q2 FY25.

Asian Paints Q2 Results: Management Commentary

Amit Syngle, Managing Director & CEO of Asian Paints Limited said that – “The paint industry faced a subdued demand environment during the quarter. Domestic Decorative coatings segment volumes declined marginally while overall domestic coatings revenue declined by 5.5% for the quarter impacted by muted consumer sentiments and extended rains and floods in some parts of the country. Operating margins were impacted by the price reductions taken last year, higher material prices and increased sales expenses. While we took price increases during the quarter, full impact of the same should flow through only in the second half of the year.

The Industrial Business did relatively better with single digit value growth supported by
growth in the general industrial, protective coatings and refinish segments. We continued to register growth in our Home Décor categories across our Beautiful Homes Stores network, introducing new collections & product solutions. International Business portfolio registered a marginal decline in revenues for the quarter (8.7% growth in constant currency terms) despite unfavorable market conditions in certain key markets like Ethiopia and Bangladesh.

On the margin front, soft demand conditions, product mix and material price inflation affected margins in Q2. We expect margins to recover in the coming quarters on the back of anticipated softening in material prices coupled with price increases implemented in the last few months.

While demand conditions remain challenging, we continue to direct our efforts towards leveraging our brand strength, robust supply chain and distribution network to pursue growth”

Highlighting the Asian Paints share price performance, it has generated a negative return of 13.54% in the last 1 week (as on November 11, 2024). Keep exploring stocks and open demat account with SMC Global Securities. Stay tuned for the upcoming Nifty 50 companies quarterly results.

References
https://www.smctradeonline.com/research/equity-analysis/242
https://economictimes.indiatimes.com/asian-paints-ltd/stocks/companyid-14034.cms

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