Kansai Nerolac Paints saw its revenue for the June quarter remain flat year-on-year as demand for decorative paints remained muted due to heat wave conditions, a shortage of labour and election activity during the quarter.
The century-old paint-maker’s revenue for the quarter fell 1% on year to Rs 2,050.4 crore, while earnings before interest, tax, depreciation and amortization was flat at Rs 323.4 crores.
“A combination of measures like cost control, product mix and procurement efficiencies helped improve gross margins over the corresponding quarter last year,” managing director Anuj Jain was quoted in a release. The cost of raw materials is hardening because of geopolitical issues, but the company is working on mitigating this impact, he said.
The company’s consolidated net profit for the quarter slumped nearly 69% on year to Rs 230.83 crore. This was on account of an exceptional gain of Rs 661.25 crore in the year-ago period, making it a high base for comparison.
One of the largest paint-makers in India, Kansai Nerolac has eight manufacturing units across the country, and expects demand to improve from current levels.
“Looking forward, with a favorable monsoon demand should improve for decorative,” Jain said. “Given the continued thrust on infrastructure growth, new project and order pipeline we believe demand for performance coatings should be strong,” he said.
The company reported its earnings for the June quarter during market hours on Monday, and its shares closed at 281.70 rupees on the NSE, up 2.3% from the previous close.
