Asian Paints net income plunges 43% on weak demand

MUMBAI: The largest paint-maker Asian Paints has reported a steep 43 percent on-year plunge in consolidated net income at Rs 694.64 crore, down from Rs 1,205.42 crore a year earlier.

Managing director Amit Syngle pointed to the weak consumer demand and adverse weather conditions as key factors affecting performance.

He said the industry faced muted demand during the reporting period with domestic decorative coatings volume declining slightly, domestic coatings falling by 5.5 percent due to sluggish consumer sentiment and prolonged rains in some regions.

Operating margins were impacted by last year’s price cuts, along with higher input costs and increased selling expenses, he said, and pointed to better days ahead given the recent price hikes, which should contribute positively to margins in the second half of the fiscal year.

Syngle expressed optimism about a potential margin recovery in the coming quarters, expecting relief from lower raw material costs combined with recent price adjustments. Despite ongoing demand challenges, Asian Paints said it is leveraging the brand strength and broad distribution network to augment supply.

Despite the poor set of numbers, the company declared an interim dividend of Rs 4.25/ which is 425 percent of the face value.