Asian Paints Q2 Review - Volume Up 34%, Margins Cracked Due To Inflation: Centrum Broking

BQ Blue’s special research section collates quality and in-depth equity and economy research reports from across India’s top brokerages, asset managers and research agencies. These reports offer BloombergQuint’s subscribers an opportunity to expand their understanding of companies, sectors and the economy..Centrum Broking Report.Asian Paints Ltd.'s Q2 FY22 numbers were below estimates. Consolidated revenue grew 32.6% (2-year CAGR – value 22%, value 19.8%), while Ebitda/PAT declined 28.5%/28.1%, driven by 34% volume growth in the domestic decorative segment. The management stated that the metros and T1/T2 towns fueled growth along with rural markets; international business grew 50%+. Unprecedented inflation in input RM/PM (+20%) impacted gross margin, which fell 966bp to 33.7% despite better product mix. The management said it did some unique work on sourcing and formulation efficiencies, and took ~7.5% price hike in H1, the impact of which would be evident in Q3. Yet, Ebitda margin cracked 1,090 bps to 12.7%. Despite Covid restrictions, consumer upgrade to economy emulsions fueled volume uptick in rural markets. The management maintained positive outlook, supported by strong consumption, yet confirmed imminent price increases to offset inflation to maintain margins..Click on the attachment to read the full report:.DISCLAIMERThis report is authored by an external party. BloombergQuint does not vouch for the accuracy of its contents nor is responsible for them in any way. The contents of this section do not constitute investment advice. For that you must always consult an expert based on your individual needs. The views expressed in the report are that of the author entity and do not represent the views of BloombergQuint..Users have no license to copy, modify, or distribute the content without permission of the Original Owner.

Asian Paints Q2 Review - Volume Up 34%, Margins Cracked Due To Inflation: Centrum Broking

Asian Paints Q2 Review - Volume Up 34%, Margins Cracked Due To Inflation: Centrum Broking

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