Asian Paints, India’s leading paint and decor company, has closed the financial year 2023 on a strong note with double digit growth in volume and value, helping the company to deliver one of the highest profits in the last two decades. The company also declared a final dividend of ₹21.25 per equity share (2,125%), taking the total dividend payout for FY23 at ₹25.65 apiece with a dividend payout ratio of 60%. The paint company declared the first interim dividend of ₹4.40 per equity share in October 2022 for FY23.
For the fourth quarter ended March 31, 2023, the Mumbai- headquartered company posted consolidated profit of ₹1,234.14 crore, up 45.12% from ₹850.42 crore in the year-ago period.
The consolidated net sales increased 10.9% to ₹8,750.8 crore from ₹7,889.9 crore in the same quarter last year.
The PBDIT (profit before depreciation, interest, tax, other income, and exceptional items) increased by 29.2% to ₹1,864.8 crore from ₹ 1,443.3 crore in the corresponding period last year. The PBDIT margin as % to sales improved to 21.3% from 18.3% in the same period of the previous year.
For the full financial year 2023, the profit surged 35.5% to ₹4,106.5 crore from ₹3,030.6 crore in the previous fiscal. The consolidated net sales increased by 18.8% to hit a high of ₹34,367.8 crore from ₹28,923.5 crore in FY22. The PBDIT increased by 30.3% to ₹6,259.8 crore, while margin improved to 18.2% from the previous fiscal.
“It has been an outstanding year for us with a 14% volume growth and 20% value growth in our standalone business and a net profit growth of 31%. Our growths in both the Industrial coatings have been stellar, growing double digits in volume and value, delivering one of the highest profits in the last 2 decades,” says Amit Syngle, Managing Director & CEO, Asian Paints.
“Going forward, as a market leader, we will continue to aggressively pursue growth. Our performance will be driven by our consistent focus on customer centricity, innovation, sustained investment in B2B business coupled with our powerhouse brand, robust supply chain and distribution network”, he added.
Domestic brokerage Axis Securities said that Asian Paints' result was strong, led by double-digit volume growth. However, the EBITDA margins saw significant beat, primarily led by better-than-expected gross margin expansion due to lower raw material prices.
“Going forward, we could see margin recovery due to lower raw material prices and cost-efficiency measures. However, competition in the paint sector will be key to watch out for, as earnings will likely remain volatile,” says Preeyam Tolia, Senior Research Analyst, Axis Securities.
“In the long term, we remain positive on Asian Paints as the recent announcement of setting up (a) a Vinyl Acetate Ethylene Emulsion (VAE) & Vinyl Acetate Monomer (VAM) plant, (b) a White Cement facility through Joint Venture in Fujairah, UAE, (c) Expanding manufacturing footprint, and d) launching differentiated next-gen nanotechnology based emulsions and waterproofing products is a step in the right direction to full proof next leg of growth and protect the market share in the long run,” Tolia adds.
Boosted by Q4 results, shares of Asian Paints ended 3.22% higher at ₹3,138.50 per share on the BSE.
