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Asian Paints (APL) delivered strong performance with consolidated revenues growing by 18% YoY

ICICIdirect Research 30 Jul 2026 DISCLAIMER

News: Asian Paints (APL) delivered strong performance with consolidated revenues growing by 18% YoY to Rs10,541.9cr (ahead of our expectation of Rs9,998cr). Domestic decorative paints business grew by 16% with volume growth of 9% and realisation growth of 7%. Industrial B2B business also grew by 16% during the quarter. On home décor, side Kitchen and Weatherseal registered double digit growth of 10% and 11%, while White Teak and Bath had subdued quarter with decline in the revenues in mid-to-high single digit. International business grew by 27% with constant currency growth of 20%; delivering double digit growth across key markets. Despite inflated input prices, the company’s consolidated gross margins improved by 91bps YoY to 43.6% on back of strong sourcing capabilities, inventory of low cost raw material, better mix and calibrated pricing actions. This along with cost efficiencies led to 239bps expansion in the EBIDTA margins to 20.6% (ahead of our expectation of ~18%). EBIDTA grew by 34%YoY to Rs2,168.8cr and Adjusted PAT grew by 41% YoY to Rs1,521.3cr

View: APL had a strong start to FY27 by delivering strong operating performance in Q1FY27. Decorative business volume growth of 9% was ahead of industry growth as the company was able to compete well with small players due to strong sourcing capabilities. Volume growth was broad base across months. Management has maintained its guidance of 8-10% volume growth of FY27 (despite ~10% volume growth in H2FY26). Strong supply strengths and better inventory management aided the company to managed cost inflation very well in Q1. However, with low-cost inventory phasing out, the margins might be lower in Q2 compared with Q1. The company has taken price hike of 10-11% lower than raw material inflation of 25%. It would focus on cost efficiencies to mitigate the pressure. Maintained guidance of 18-20% margins. Overall outlook has been maintained. We believe in the current environment large paints player will perform relatively better compared to small players.

Impact: Positive

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