Berger posts mixed bag performance in Q3

News: Berger India’s Q3FY22 revenues were up 20% YoY to Rs.2551 crore led by strong volume growth. EBITDA margin declined 422 bps YoY to 15.4% due to sharp increase in raw material costs. As a result, PAT came in lower by 8% YoY to Rs.253 crore.

Views: We believe the paint industry has witnessed a sharp increase in raw material cost in 9MFY22, which led to pressure in EBITDA margin during Q3FY22. While paint players have taken steep price hike of ~21% YTD in 9MFY22, the positive impact of the same will start visible from Q4FY22 onwards. We await management commentary on paint demand outlook, going forward.

Impact: Neutral