Tag: kansai nerolac paints

Categories
Market News Top 10 News

India’s Manufacturing PMI Falls to 57.8 in June – Top Indian Market Updates

Here are some of the major updates that could move the markets tomorrow:

India’s manufacturing PMI slips to 57.8 in June

India’s manufacturing PMI (Purchasing Manager’s Index) for June stood at 57.8, compared to 58.87 in May. The PMI of 57.8 is higher than 50 indicating an expansion in activities. Anything below 50 indicates contraction. India’s May manufacturing sector activity was at a 31-month high.

PMI is a month-on-month calculation, and a value above 50 represents an expansion compared to the previous month.

Read more here.

Adani Ports registers record cargo volume of over 100 MMT in June quarter

Adani Ports and Special Economic Zone Ltd (APSEZ) has reported an 11.5% YoY increase in cargo volume handled at 101.4 million metric tonnes (MMT) in the quarter ending June 2023. This is the highest-ever quarterly cargo volume handled by the company. The company witnessed growth across most ports and all three broad cargo segments. The container segment grew 19% YoY, while liquids and gas and dry bulk segments grew 8% and 7% YoY respectively.

Read more here.

Edelweiss Financial Services to raise Rs 300 crore from NCDs 

Edelweiss Financial Services has announced the public issue of secured redeemable non-convertible debentures (NCDs). The NCDs have a face value of ₹1,000 each, amounting to ₹150 crores (base issue size). The issue also has the option to retain over-subscription up to ₹150 crores aggregating to ₹300 crores. Effective annual yield for NCDs ranges from 8.94% to 10.46%.

Read more here.

USFDA closes inspection at Zydus’ Ahmedabad unit with VAI recommendation

Zydus Lifesciences Ltd’s Ahmedabad unit received an ‘Establishment Inspection Report’ (EIR) from the United States Food and Drug Administration (USFDA). The inspection has been closed with a ‘voluntary action indicated’ (VAI) recommendation in the EIR. A VAI is generally issued when a plant receives observations and responds to them, and the regulator believes the response by the company is satisfactory.

Read more here.

Kansai Nerolac sells Thane land parcel for Rs 671 crore to Hiranandani Group

Kansai Nerolac Paints Ltd sold its land parcel in Thane to the Hiranandani Group. The sale was for a total consideration of ₹671 crore. The company entered into a deed of conveyance last Friday for the sale of a total area of 97,090 square metres together with the transfer of rights in land admeasuring 6,300 square metres.

Read more here.

SpiceJet repays Rs 100 crore to City Union Bank, releasing all securities pledged

SpiceJet completed the ₹100 crore settlement payment to City Union Bank a little over a decade after it took the loan. The airline said it paid the last Rs 25 crore tranche on June 30, 2023, thereby shutting the loan account opened in 2012. With this, all the securities of the airline that had been pledged with the bank now get released. 

Read more here.

Lupin gets USFDA nod for cyanocobalamin nasal spray

Lupin Ltd has received approval from the United States Food and Drug Administration (US FDA) for its Abbreviated New Drug Application (ANDA) for cyanocobalamin nasal spray. The cyanocobalamin nasal spray is a generic equivalent of Nascobal nasal spray. According to IQVIA MAT, Cyanocobalamin nasal spray (RLD Nascobal) had estimated annual sales of $69 million in the US.

Read more here.

IIFL Finance raises $175 million from HSBC, Union Bank & Bank of Baroda

IIFL Finance raised $175 million through the external commercial borrowing (ECB) route in June 2023. The NBFC has raised $75 million from HSBC, $50 million from Union Bank (Sydney), and $50 million from Bank of Baroda. The company raised funds at SOFR (Secured Overnight Financing Rate) plus 200 basis points. With this, the company’s total borrowing since March 2023 aggregates to $275 million.

Read more here.

Zee and IndusInd Bank announce a settlement of all dues

The National Company Law Appellate Tribunal (NCLAT) has closed the insolvency proceedings against Zeel after payment to creditors. NCLAT recorded that all payments were made to IndusInd Bank by June 30 as per the agreed-upon terms. As per IndusInd Bank’s plea, Zee paid nearly ₹84 crores in the case related to Siti Networks.

Read more here.

Bank of Maharashtra clocks 25% loan growth

Bank of Maharashtra has posted a credit growth of 24.93% at ₹1.75 lakh crore in the June quarter. The outstanding credit was ₹1.40 lakh crore at the end of June 30, 2022. The bank registered a 24.82% growth in the total business (total advances and total deposits) to ₹4.19 lakh crore at the end of June 2023 compared to ₹3.36 lakh crore in the June quarter of 2022.

Read more here.

Categories
Market News Top 10 News

Apollo Tyres Net Profit Jumps 277% YoY to Rs 427Cr in Q4 – Top Indian Market Updates

Here are some of the major updates that could move the markets tomorrow:

Apollo Tyres Q4 Results: Net profit jumps 277% YoY to Rs 427 crore

Apollo Tyres reported a 277% YoY jump in consolidated net profit to Rs 427 crore for Q4 FY23. Its operating revenue rose 12% YoY to Rs 6,247 crore during the same quarter. The company’s board has recommended a final dividend of Rs 4 and a special dividend of Rs 0.5 per equity share on the occasion of the company’s  50th annual general meeting.

Read more here.

Adani Ports to prepay $130 million debt

Adani Ports & Special Economic Zone (APSEZ) will prepay $130 million of debt to regain investor confidence. The company had floated a tender to buy back as much as USD 130 million of its July 2024 bonds and similar amounts in each of the next four. APSEZ has received an aggregate principal amount of $412.7 million.

Read more here.

Nazara Tech Q4 Results: Net profit rises 18% YoY to Rs 2.6 crore

Nazara Tech reported an 18% YoY rise in consolidated net profit to Rs 2.6 crore for Q4 FY23. Its operating revenue increased 65.2% YoY to Rs 289 crore during the quarter. The total expenses for the quarter rose to Rs 281 crore from Rs 174 crore a year ago. In FY23, gaming made for 37% of Nazara Tech’s total revenue, while 49% came from eSports, and the rest from AdTech.

Read more here.

Dalmia Cement signs MoU to invest Rs 4,600 crore in Assam

Dalmia Cement Bharat has signed a Memorandum of Understanding (MoU) with the Assam government to invest about Rs 4,600 crore and create 2500 jobs in the state. The company aims to promote industrial activity and support the overall development of the region, with the government’s assistance. 

Read more here.

India Bulls Real Estate merger with Nam Estates and Embassy One withheld by NCLT

The merger of Nam Estates Private Limited and Embassy One into India Bulls Real Estate has been withheld by the Chandigarh Bench of the National Company Law Tribunal (NCLT) despite already being sanctioned by the NCLT Bengaluru Bench. The Chandigarh Bench raised concerns based on objections cited by the Income Tax department to the merger.

Read more here.

Raymond Q4 Results: Net profit falls 26% YoY to Rs 196.5 crore

Raymond Ltd reported a 26% YoY fall in consolidated net profit to Rs 196.5 crore for Q4 FY23. Its operating revenue rose 9.8% YoY to Rs 2,150 crore during the same quarter. The total income during the quarter was up 7.89% to Rs 2,192 crore. Total expenses of the company stood at Rs 1,939.27 crore, up 17.34% YoY.

Read more here.

Venus Remedies gets marketing approval for cancer drugs in Philippines, Iraq

Venus Remedies has obtained marketing authorization for two additional cancer drugs, Bleomycin and Gemcitabine, from the Philippines and Iraq, respectively. Bleomycin is used to treat various types of cancer, while Gemcitabine is used to treat a type of lung cancer. The company has secured marketing approval for 37 products in the Philippines.

Read more here.

Anupam Rasayan renews long-term contract worth Rs 436 crore

Anupam Rasayan India Ltd has renewed a long-term contract with a German multinational firm worth around Rs 436 crore for the supply of patented life science specialty chemicals exclusively for the next three years. The renewal is in accordance with the automatic clause agreed upon by the parties in the long-term agreement signed three years ago.

Read more here.

Castrol Q4 Results: Net profit falls 11.3% YoY to Rs 202 crore

Castrol reported an 11.3% YoY decline in net profit to Rs 202.5 crore for Q4 FY23. Its operating revenue rose 4.7% YoY to Rs 1,293 crore during the quarter. EBITDA stood at Rs 295 crore, down 7% from Q4 FY22.  According to the company, the fall in profit is due to a rise in input costs.

Read more here.

Kansai Nerolac declares 1:2 bonus issue

Kansai Nerolac Paints Ltd. announced a bonus share issue of 1:2. This means that two shares will be issued for every equity share held by eligible shareholders as of the record date. The record date has not yet been determined. The board of Kansai Nerolac also recommended a dividend of Rs 2.70 per share for the financial year 2023. 

Read more here.

Three Adani firms lose endorsement of UN-backed climate group

Adani Green, Adani Transmission Ltd. and Adani Ports & Special Economic Zone Ltd. were removed from the list of “companies taking action” published by the Science Based Targets initiative (SBTi) in late April 2023. The UN-backed group helps companies establish concrete plans to reduce emissions consistent with the Paris Agreement’s target of limiting global warming. The SBTi found that the companies are not in conformity with the initiative’s standards and policy requirements.

Read more here.

Categories
Market News Top 10 News

HDFC Reports 42% YoY Rise in Net Profit in Q4 – Top Indian Market News

hdfc

HDFC Q4 Results: Net profit rises 42% YoY to Rs 3,180 crore

Housing Development Finance Corporation (HDFC) reported a 42% YoY increase in net profit to Rs 3,180 crore for the quarter ended March (Q4). On a quarterly basis, net profit has increased by 8.7%. Net interest income (NII) rose 14% YoY to Rs 4,065 crore during the same period. The gross non-performing assets (NPAs) ratio stood at Rs 1.98%, compared with 1.91% in Q3 FY21. HDFC’s board has approved a dividend of Rs 23 per share. The board has also approved fundraising of up to Rs 1.25 lakh crore by issuing non-convertible debentures on a private placement basis.

Read more here.

Dabur Q4 Results: Net profit rises 34% YoY to Rs 378 crore

Dabur India Ltd reported a 34.4% YoY increase in consolidated net profit to Rs 378 crore for the quarter ended March (Q4). The FMCG firm’s revenue from operations rose 25.3% YoY to Rs 2,337 crore during the same period. Its India FMCG business grew 28.3% and posted best-ever volume growth of 25.4% in Q4. For the financial year ended March 31, 2021 (FY21), net profit rose 17.2% YoY to Rs 1,693 crore. Dabur India’s board has proposed a final dividend of Rs 3 per share.

Read more here.

JSW Steel signs pact with JFE Steel Corp to establish JV in India

JSW Steel has signed a Memorandum of Understanding (MoU) with Japan-based JFE Steel Corporation to conduct a feasibility study to establish a grain-oriented electrical steel sheet manufacturing and sales joint venture (JV) company in India. Grain-oriented electrical steel is an important material used in the production of energy-efficient transformers and high-performance generators. The companies plan to complete the study within the current financial year and take appropriate steps to set up the JV company.

Read more here.

Steel Strips Q4 Results: Net profit at Rs 44.5 crore

Steel Strips Wheels Ltd reported a net profit of Rs 44.56 crore for the quarter ended March (Q4 FY21). It had posted a net loss of Rs 5.25 crore in the corresponding period last year (Q4 FY20). On a quarterly basis, net profit has increased by 54% in Q4 FY21. Revenue from operations rose 80.81% YoY to Rs 699.87 crore during the same period. For the financial year ended March 31, 2021 (FY21), net profit rose 110% YoY to Rs 49.25 crore. The company’s board has declared a final dividend of Rs 2 per share.

Read more here.

Tata Motors to hike prices of passenger vehicles from May 8

Tata Motors Ltd said it will increase the prices of its passenger cars by an average of 1.8%, depending on the model and variant, from May 8. This is to partially offset the rise in input costs. The surge in prices of commodities such as steel and precious metals has forced the automaker to hike prices. Tata Motors will also extend price protection for customers who have booked vehicles on or before May 7.

Read more here.

Kansai Nerolac Paints Q4 Results: Net profit rises 89% YoY to Rs 124 crore

Kansai Nerolac Paints Ltd reported an 89.14% YoY increase in consolidated net profit to Rs 123.62 crore for the quarter ended March (Q4). On a quarterly basis, net profit has declined by 39%. Its total revenue rose 35.14% YoY to Rs 1,459.57 crore during the same period. The company’s profit margins improved from 6.22% in Q4 FY20 to 8.51% in Q4 FY21. Kansai Nerolac Paints’ board has recommended a final dividend of Rs 4 per share.

Read more here.

Godrej Agrovet Q4 Results: Net profit declines 24% You to Rs 56 crore

Godrej Agrovet Ltd reported a 24.12% YoY decline in net profit to Rs 56.59 crore for the quarter ended March (Q4). Its revenue fell 10.4% YoY to Rs 1,472.39 crore during the same period. The company’s poultry and processed foods business grew 22% YoY to Rs 139 crore in Q4. For the financial year ended March 31, 2021 (FY21), net profit has increased by 2.47% YoY to Rs 313.74 crore. Godrej Agrovet’s board has declared a final dividend of Rs 8 per share.

Read more here. 

GE Shipping Company Q4 Results: Net profit at Rs 49 crore

Great Eastern Shipping Company reported a net profit of Rs 49.01 crore for the quarter ended March (Q4). It had posted a net loss of Rs 50.68 crore in the corresponding period last year. On a quarterly basis, net profit has fallen by 72% in Q4 FY21. Revenue from operations declined by 26.68% YoY to Rs 739.95 crore during the same period. For the financial year ended March 31, 2021 (FY21), net profit has increased by 343.43% YoY to Rs 918.52 crore. GE Shipping Company’s board has announced a final dividend of Rs 9 per share.

The company’s board has also approved fundraising of up to Rs 1,000 crore through the issuance of non-convertible debentures (NCDs) on a private placement basis.

Read more here.

RailTel secures order worth Rs 11.99 crore from Cotton Corp

RailTel Corporation of India has received a work order from Cotton Corporation of India for hiring on-cloud Data Centre hosting for hardware and software, along with the migration of Oracle EBS and other applications. The total cost for the five years contract period is Rs 11.99 crore.

Categories
Market News Top 10 News

Finance Minister Presents Union Budget 2022 in Parliament – Top Indian Market News

Finance Minister presents Union Budget 2022 in Parliament

Finance Minister Nirmala Sitharaman has presented the Union Budget 2021-22 in the Parliament. The minister has announced the scrapping of income tax for senior citizens above 75 years and new rules for the removal of double taxation for NRIs. Sitharaman has also announced a Rs 64,180 crore package for the healthcare sector, which will be spread over the next 6 years. A voluntary scrapping policy for old vehicles has also been launched. India’s fiscal deficit is set to jump to 9.5% of the GDP in 2020-21.

Read more here.

Automobile companies register strong sales growth in January

Major automobile companies registered healthy sales growth during January 2021. Tata Motors posted a 28% YoY increase in domestic sales to 57,742 units, which was led by higher car sales. TVS Motor Company reported a 31% YoY increase in total sales to 3.07 lakh units in January. Mahindra & Mahindra’s farm equipment sales rose 50% YoY to 34,778 units. Maruti Suzuki posted a 4.3% YoY increase in total sales to 1.60 lakh units during the same period.

Read more here.

Adani Green Energy commissions 100 MW solar power plant in Uttar Pradesh

Adani Solar Energy Four Pvt Ltd, a subsidiary of Adani Green Energy Ltd (AGEL), has commissioned a 100 MW (2×50 MW) solar power project at Jalalabad in Uttar Pradesh. The two solar plants have power purchase agreements (PPAs) with Uttar Pradesh Power Corporation Ltd (UPPCL) at Rs 3.22/kWh and 3.19/kWh, respectively, for a period of 25 years. This places AGEL’s total renewable portfolio of 14,815 MW well on track to reach its vision of 25 GW capacity by 2025.

Read more here.

SJVN bags 679 MW hydroelectric project in Nepal

SJVN Ltd has received an order from the Investment Board of Nepal to construct a 679 MW Lower Arun Hydropower Project. The project will be constructed under a Build, Own, Operate and Transfer (BOOT) model. On completion, the project will generate 3,561 million units of electricity per annum. 

Read more here.

Kansai Nerolac Paints Q3 Results: Net profit rises 76% YoY to Rs 204 crore

Kansai Nerolac Paints reported a 76.58% YoY increase in consolidated net profit to Rs 204.5 crore for the quarter ended December (Q3). Its revenue rose 19.68% YoY to Rs 1,606.86 crore during the same period. The company stated that both the decorative and industrial segments witnessed double-digit volume growth in Q3. 

Read more here.

Coromandel Q3 Results: Net profit rises 26% YoY to Rs 333 crore

Coromandel International Ltd reported a 26.20% YoY increase in net profit to Rs 333.80 crore for the quarter ended December (Q3). Its revenue rose 7.76% YoY to Rs 3,541.87 crore during the same period. The company’s board has declared an interim dividend of Rs 6 per share. Hyderabad-based Coromandel International is in the business of fertilizers, pesticides, and specialty nutrients.

Tata Power gets LoI for distribution and retail sale of electricity

Tata Power Ltd has received a Letter of Intent (LoI) from the Odisha Electricity Regulatory Commission (OERC) for the distribution and retail supply of electricity in the 5 circles of North Eastern Electricity Supply Company of Odisha Ltd’s (NESCO) Utility. This includes the areas of Balasore, Bhadrak, Baripada, Jajpur, and Keonjhar. The proposed sale of NESCO Utility to Tata Power will be through the formation of a Special Purpose Vehicle (SPV) entity.

Read more here.

Zensar launches integrated Digital XDR solution

Zensar Technologies Ltd has launched an integrated Digital XDR (extended threat detection response) solution as part of its Digital Foundation Services offerings. The XDR solution provides organizations with adaptive expert intelligence and threat prediction capabilities by prioritizing the business risk tailored to their environment. This offering eliminates the need for expensive hardware appliances and provides usage-based threat detection and hunting services. 

Read more here.

Rane Brake Q3 Results: Net profit rises 26% YoY to Rs 12 crore

Rane Brake Lining Ltd reported a 25.9% YoY increase in net profit to Rs 12.88 crore for the quarter ended December (Q3). Its revenue rose 4.7% YoY to Rs 126.58 crore during the same period. The Chennai-based company manufactures and sells brake pads, brake blocks, and other friction materials for the automobile industry.

MRPL Q3 Results: Net loss at Rs 71 crore

Mangalore Refinery and Petrochemicals Ltd (MRPL) reported a net loss of Rs 71 crore for the quarter ended December (Q3). It has posted a net loss of Rs 37 crore in the corresponding period last year. The company’s revenue from operations stood at Rs 14,136 crore in Q3, compared with Rs 16,745 crore in Q3 FY20. The gross refining margin (GRM) of MRPL stood at $3.26 per barrel in Q3 FY21, as against $3.19 per barrel in the corresponding period last year.

Read more here.

NCC secures five new orders worth Rs 1,200 crore

NCC Limited announced that it had received five new orders worth Rs 1,200 crore in the month of January 2021. Out of these, orders worth Rs 607 crore pertain to the Water & Environment Division, and order worth Rs 593 Crore pertain to its Buildings Division. These orders have been received from various Central/State Government agencies.

Categories
Editorial

The Paint Industry in India: An Analysis

The existing economic conditions have proven to be favourable for the real estate and construction sectors in India. Lower interest rates and higher disposable income amongst people have led to a strong recovery in demand for real estate properties. Developers are focusing on completing projects and are also launching new ones. Since people were forced to stay at home amidst the Covid-19 pandemic, many felt an urge to renovate or decorate their houses/apartments. Also, automobile manufacturers have been receiving an influx of demand for two-wheelers, passenger cars, etc.

All these factors have ultimately provided a major boost for the paint industry. The companies that offer paints and coatings are witnessing increased sales volumes. We have also seen a surge in their stock prices in recent weeks. Let us take a look at some of the top listed companies that fall under the paint industry.

Asian Paints

Asian Paints Limited was founded in 1942 and is based in Mumbai. The company manufactures, sells, and distributes paints and coatings for decorative and industrial use in India. It offers wall finishes, metal finishes, and wood finishes for interior and exterior surfaces. It provides a wide range of mechanised tools, waterproofing products, adhesives, bath fittings, wardrobes, wall coverings, and surface disinfectants. They also offer color consultancy, home painting, décor, interior design, and sanitization services. 

The company manufactures essential components such as varnishes, enamels, and lacquers (used for glossy finishes), organic composite solvents, and thinners. It has also ventured into modular kitchens and kitchen components, including wire baskets, cabinets, appliances, and accessories. The company offers its products under the Asian Paints, Apco Coatings, Asian Paints Berger, Causeway Paints, SCIB Paints, Taubmans, and Kadisco Asian Paints brands. They operate in 19 countries and have 26 paint manufacturing facilities around the world. It has a wide distribution network consisting of more than 70,000 dealers.

Financial Performance

Asian Paints reported a 62% year-on-year (YoY) jump in consolidated net profit to Rs 1,265.35 crore for the quarter ended December (Q3). Its revenue from operations rose 25.43% YoY to Rs 6,886.39 crore during the same period. The company’s domestic decorative business delivered more than 30% volume growth, led by premium and luxury portfolios. Asian Paints’ international business also recorded double-digit volume growth, led by Asia and the Middle East. With the revival of economic activities, the company has been receiving more demand for its range of paints and coatings from automobile manufacturers, real estate developers, etc.

Over the last 5 years, the company’s revenue has grown at a CAGR of 6.18%, whereas the industry average stood at 6.68%. Asian Paints has been able to secure a market share of 63.38%. It has continued to show dominance in the market by focusing on research & development and launching innovative products. 

The share price of Asian Paints has surged more than 56% since the beginning of the current financial year. 

Berger Paints India

Berger Paints India Limited was founded in 1923 and is based in Kolkata. The company manufactures and sells paint products for home, professional, and industrial users in India. It offers a wide range of interior and exterior wall coatings. They also provide waterproofing solutions, construction chemicals, flooring compounds, adhesives, and protective & anti-corrosive coatings. It has 16 manufacturing facilities located across India, Nepal, Poland, and Russia. With a distribution network of more than 25,000 dealers, Berger Paints has been able to provide tailor-made services to individual and corporate clients. The company is a subsidiary of U.K. Paints India Private Limited.

Financial Performance

Amidst the Covid-19 pandemic, Berger Paints reported an impressive 13.55% YoY increase in consolidated net profit to Rs 221.05 crore for the quarter ended September (Q2). The company will post its Q3 results soon. Industry experts have estimated that its revenue and sales will show significant growth.

Over the last 5 years, the company’s revenue has grown at a yearly rate of 8.1%, whereas the industry average stood at 6.68%. It has been showing a consistent jump in revenues and profits during the same period. Berger Paints has been able to secure a market share of 19.83%.

Since April 2020, the share price of Berger Paints India has increased by more than 54%! 

Kansai Nerolac Paints

Kansai Nerolac Paints Limited was founded in 1920 and is headquartered in Mumbai. The company manufactures and sells paints, varnishes, enamels, and lacquers in India. It offers interior and exterior decorative wall paints, wood coatings, metal enamel paints, and ancillary paints. The company was formerly known as Goodlass Nerolac Paints Ltd and changed its name to Kansai Nerolac Paints Ltd in April 2006. It is a subsidiary of Kansai Paint Co., Ltd- a Japan-based chemical company.

Kansai Nerolac Paints reported an 11.56% YoY decline in consolidated net profit to Rs 167.96 crore for the quarter ended September (Q2). As India came out of lockdowns, the company saw a very slow recovery in demand for its products. The sales volumes of Kansai’s industrial paints segment, which contributes more than 40% of its overall revenues, had declined. The company is yet to post its Q3 results. 

Over the last 5 years, the company’s revenue has grown at a yearly rate of 6.81%, whereas the industry average stood at 6.68%. Kansai Nerolac has been able to secure a market share of 16.35%.

The shares of Kansai Nerolac Paints has surged by more than 57% since April 2020.

Akzo Nobel India

Akzo Nobel India Limited manufactures and sells paints and coatings in India and internationally. The Gurugram-based company offers marine coatings, protective coatings, industrial coatings, automotive, and specialty coatings. It produces paints, varnishes, enamels, and lacquers for interior and exterior use. The company’s products are widely used for oil and gas, power, infrastructure, and wind energy projects. They also cater to the architecture & construction, offshore supply, transport vessels, and fishing sectors. 

Akzo Nobel has also ventured into the roofing and domestic appliance sectors. Its products are primarily offered under the Dulux, Sikkens, and Interpon brands. The company was formerly known as ICI India Limited and changed its name to Akzo Nobel India Ltd in February 2010. It is a subsidiary of Akzo Nobel N.V.- a Dutch multinational company that creates paints and performance coatings for industries and consumers worldwide.

Financial Performance

Amidst the impact of the Covid-19 pandemic, Akzo Nobel reported a 35% YoY increase in consolidated net profit to Rs 66.28 crore for the quarter ended December (Q3). However, its revenue from operations was down 4.25% to Rs 606.86 crore during the same period. The company continues to face severe challenges with respect to demand. It is yet to post Q3 results.

Akzo Nobel’s revenues and profits have been showing a sharp decline since the previous financial year. Over the last 5 years, the company’s revenue has grown at a yearly rate of 0.82%, whereas the industry average stood at 3.41%. They have been able to secure a market share of 6.12% in the Specialty Chemicals sector.

Since April 2020, the share price of Akzo Nobel India has increased by 10% so far.

Conclusion

The paint industry is currently booming in India. These companies have been able to meet the requirements of individual homeowners through well-defined distribution networks. They have catered to the rising demand from the real estate and automobile sectors. They have also invested heavily in research & development activities and advertisements. The technological advancements in this industry have heavily contributed to their overall growth. Recently, paint companies reported that there had been a rise in the cost of essential raw materials. The price of crude oil (which is a primary raw material for paints) has been increasing. Thus, several companies are planning to hike the prices of their paint and coating products in Q4. 

At the same time, we can see an increase in competition in this particular industry. Indigo Paints has emerged as a top competitor by reporting strong growth over the years. The company’s shares will get listed on the stock markets on February 2. Meanwhile, Grasim Industries has announced its plans to enter the decorative paints business, which is a Rs 40,000 crore industry in India. It would invest Rs 5,000 crore in the next three years and is eyeing the second position in the sector (in terms of market share). After the announcement, we saw Grasim’s shares rise as much as 11% (intraday) on Jan 25. On worries about increased competition, the stocks of major paint firms fell between 3% and 6% on the same day. Grasim’s entry is expected to cause excessive price-led competition in the paint industry. 

Will the listed firms mentioned above be able to face these challenges in the years to come? Will end-consumers be affected due to a further rise in the prices of paints? Let us wait and watch.