Asian Paints reports Q4FY22 resultsASIANPAINT - 3000 Change: -64.10 (-2.09 %)
News: Asian Paints’ consolidated revenue increased by ~19% YoY to Rs 7893 crore supported by decorative volume growth of ~8% YoY. Sharp fall in gross margin (down by 448 bps YoY) was partially offset by savings in other costs, restricting the overall fall in EBITDA margin by 153 bps YoY at 18.3% . PAT came in at Rs 874 crore flat on YoY basis tracking lower EBITDA margin and exceptional loss of Rs 115 crore.
Views: Asian paints has reported a strong volume growth in Q4FY22 even on a higher base of 48% volume growth in Q4FY22. High decorative volume growth is due to its vast dealer network (70,000+), strong supply chain, and market share gains from unorganized/regional companies. The management has guided for double digit volume growth in FY23E along with price hike. The price hike is largely to offset input cost pressure and to bring back the margin profile of the company at pre-covid level (~18-20%). We maintain our positive stance on the stock considering its leadership position in the decorative paint industry and ability to pass on higher raw material prices thereby limiting the dent of profitability