ICICI Securities: Akzo Nobel - Turnaround Thesis Intact, Notwithstanding The Q1 Print
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ICICI Securities Report
Akzo Nobel India Ltd. has reached approximately 80% of pre-covid-19 revenues by June 2020, in our view.
Though it's revenue salience is higher in metro and tier one cities, there is strong month-on-month recovery which leads us to model 100% recovery by end of Q2 FY21.
In this difficult period, it has continued to support the trade and painters under 'Project Dulux' and steady launches of technologically superior products such as high performance primers under Interpon brand.
We expect Akzo Nobel to reap dividends in FY22 (and beyond) from investments in distribution and new products in FY18-20.
Revenues, Ebitda and profit after tax declined 64.1%, 112.2% and 135.5%, respectively. Lockdown in April 2020 and extended lockdown in May 2020 impacted off-take.
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