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News: Asian Paints' consolidated revenue grew ~7% YoY to ~Rs 9,182 crore led by ~10% YoY volume growth. Gross margin remained flattish sequentially however was up 523 bps YoY aided by easing raw material prices. EBITDA margin improved 188 bps QoQ to 23.1% (largely led by operating leverage gains) & was up 502 bps YoY. PAT came in at Rs 1,575 crore, up 25% QoQ & 52% YoY led by improvement in margin profile & higher other income.
Views: We believe Asian Paints reported a strong performance in Q1FY24 led by double digit volume growth. Even on the margin front, a sequential recovery in margin is encouraging and is highest in recent past (last peak margin achieved in Q2FY21). This was largely driven by better operating leverage & benign raw material prices. Going forward moderation in raw material prices to continue to provide comfort.
Impact: Neutral