Kansai Nerolac Q3 PAT down 15% YoY; concludes price increase with all its key OEMs

Kansai Nerolac Paints reported 15.2% fall in net profit to Rs 112.3 crore despite a 1.4% rise in net revenue from operations to Rs 1,717.1 crore in Q3 FY23 over Q3 FY22.

EBIDTA for Q3 FY23 was at Rs 188.5 crores, recording a de-growth of 10.2 % over Q3 FY22.

The company said that Other operating income of previous year's Q3 included exceptional income of Rs 44.8 crore. Excluding this, Net revenue is up by 4.1 %, EBITDA is up by 14.1% and PAT is up by 13.5%.

Anuj Jain, managing director, Kansai Nerolac Paints, said, The quarter witnessed good demand in Automotive coatings. Demand in Decorative was impacted on account of early Diwali, extended monsoons and higher than normal channel stocking due to price increases during Oct 21 & Nov 21.

Raw material prices showed a decline during the quarter. The quarter continued to witness high exchange volatility with the rupee sharply depreciating further.

The company was able to conclude the price increases with all its key OEMs during the quarter which will help partly offset the high inflation witnessed over the last two years.

The company initiated various measures to increase growth in decorative. The measures include increase in feet on street, digital interventions, network expansion, new product launches and brand strengthening. Judicious management of costs and overheads continued.

Looking forward it is expected that demand would remain healthy in the short to medium term.

On its outlook for the Indian Paint Industry, the company said that the size of domestic paint industry is estimated at around Rs 60,000 crore as of March 2022. The good growth in infrastructure, core sector as well as automobile and real estate is likely to have a positive effect on the overall demand of paint for the industry in the long run.

Kansai Nerolac Paints has been at the forefront of paint manufacturing pioneering a wide spectrum of quality paints. The company is one of the leading paint companies in India and is the leader in Industrial paints. The company has eight strategically located manufacturing units all over India and a strong dealer network across the country. The company manufactures a diversified range of products ranging from decorative paints coatings for homes, offices, hospitals, and hotels to sophisticated industrial coatings for most of the industries.

The scrip advanced 0.89% to currently trade at Rs 418 on the BSE.

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