#ROE

The ROE for FY25 was 19%, impacted by lower profitability. This also includes an exceptional item impact of slae of land. However excluding the impact of exceptional item incorporated in net profit, the ROE would be different.

#SECTOR #POTENTIAL

• The domestic paint industry consisting of the decorative and industrial paint segment is estimated at over ~₹80,000 cr. The decorative paint segment constitutes 75% and industrial paint segment makes up the balance 25% of the domestic paint market. • The Indian coatings market is projected to achieve a revenue CAGR of 7.4% over the period 2025–2027, significantly outpacing the global coatings market, which is expected to grow at a CAGR of 3.9% during the same period. • 75% of the Indian paint industry is dominated by the organized players and rest by the unorganized players. Increased customer awareness has led to a shift in preference from unorganized to organized players, reducing dealer influence and making it imperative to establish a strong brand image. • The Indian paint industry, particularly the decorative segment, continued to face headwinds in FY25 due to heightened competition and subdued demand. The organized decorative paint sector recorded negative growth, impacted by intensified competition from both established and new players. Additionally, the year was marked by a slowdown in new construction activity, reduced renovation intensity, and weaker-than-expected B2B demand. Despite these headwinds, recent trends indicate early signs of recovery. • The Indian paint industry has been witnessing a gradual shift in the preferences of customers from the traditional whitewash to high-quality paints like emulsions and enamel paints, which is providing the basic stability for growth of Indian paint industry. • Crude oil forming an essential component of raw material for paint companies, any volatility in its price will need to be critically monitored to cushion the impact on profitability. Recently, the prices of crude oil saw a substantial decline. • The government has applied anti-dumping duty on Rutile (titanium dioxide) originating in or exported from China. • As per RBI (Reserve Bank of India) bulletin, rural demand is expected to continue the growth momentum and construction activity is poised to increase.

#COMPANY #OUTLOOK

• The company aspires to outpace overall market growth and targets revenue CAGR of ~10% by FY30, with an EBITDA margin of around 18%. Over the next three years (FY25–FY28), it aims to achieve: Revenue CAGR of ~9%, with EBITDA margin in the range of 14%–15%. • They aim to establish India as the leading entity within Kansai Paints Limited (currently it contribute 24.3%) under the new leadership. • It shall maintain the market leadership in the Automotive segment and attain the No.1 position in Industrial Coatings. • Key strategies in the retail segment includes leveraging product superiority through Paint+ and advanced Japanese technology, implementation of influencer engagement and painter loyalty programs and drive distribution expansion to broaden market presence. In the project segment, the focus is on expanding geographical presence, building a strong pipeline of project sites, and offering a specialized product range tailored to project-specific requirements. • Key growth drivers in the construction chemicals include - Offering a comprehensive product portfolio, Strengthening distribution networks & Engaging through architect and interior designer programs. In the wood finish (Premium) segment, it shall maintain a complete product portfolio, focus on distribution expansion and promote via architect & interior designer engagement programs.

Kansai Nerolac Paints Limited 180-230
Expected level 300
Support 150

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1435🚀Long term level hit 🎯

970💥

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Asian Paints Ltd Company Details Report

Asian Paints Ltd is an Indian multinational paint company, headquartered in Mumbai, Maharashtra. It manufactures a wide range of paints for decorative and industrial use. In decorative paints, the company is present in interior wall finishes, exterior wall finishes, adhesives, waterproofing, undercoats, enamels and wood finishes. In the industrial segment it operates through two joint ventures (JV) PPG Asian Paints Pvt. Ltd. (PPG-AP) for automotive, marine and packaging coatings and Asian Paints PPG Pvt. Ltd. (AP-PPG) for industrial protective coatings, powder coatings, floor coatings and road markings. In the home décor segment, it offers solutions that includes paints, adhesives, wall coverings, modular kitchens and wardrobes, textures painting aid, bath fittings and sanitaryware, waterproofing, decorative lightings (through White teak), wall stickers, furniture, furnishings & rugs, UPVC (unplasticized polyvinyl chloride) windows & door systems (through Weatherseal) and mechanized tools. As on 31st March 2025, company’s installed in-house decorative paint manufacturing capacity in India is 22,90,000 kilo litre (KL)/annum (over and above, it has also tied up with outside processing centres for manufacture and purchase of certain products). It has 26 in-house paint manufacturing facilities worldwide. It caters to over ~1,69,000 touch-points across India. It operates in emerging economies through its seven corporate brands, viz. Asian Paints, Apco Coatings, Asian Paints Berger, Asian Paints Causeway, SCIB Paints, Taubmans and Kadisco Asian Paints.

Segment wise revenue

Region wise revenue

#SALES #GROWTH

Revenue in FY25 declined by 4.5% YoY at ₹33,906 cr, impacted by weak consumer demand and slowdown in urban market. Decorative & Industrial paints witnessed value de-growth of ~5% YoY, whereas volume growth was ~3%. Industrial segment outpaced the decorative segment, with superior performance in tier-3 and tier-4 cities. The home décor segment reported subdued performance driven by ~20% YoY decrease in White Teak due to the impact of BIS (Bureau of Indian Standards) specifications as majority of the inputs are sourced from China. Weatherseal was impacted by the pricing scenario in the B2B (business-to-business) segment. Further, international business was impacted by currency devaluation in Africa. Middle East posted strong double-digit growth, especially markets of UAE.

#EBITDA #GROWTH

In FY25, EBITDA stood at ₹6,006 cr v/s ₹7,585 cr in FY24, translating to a de-growth of ~21%. This was mainly driven by inferior product mix and ~12% increase in employee cost. Gross profit reduced by ~7% to ₹14,390 cr.

#EBITDA #MARGIN

In FY25, EBITDA margin stood at 17.7%, contracting by 365 bps YoY. Gross margin was down by 96 bps YoY at 42.4%. The company initiated ~1.2% price hike across its portfolio.

#PAT #GROWTH

In FY25, PAT was down by ~33% YoY at ₹3,569 cr v/s ₹5,425 cr in FY24. This included loss of ~₹202 cr towards impairment provision on goodwill on consolidation & tangibles in White Teak. Additional ~₹56 cr was recognised towards forex loss in a subsidiary due to currency devaluation in Ethiopia, impairment loss of ~₹84 cr towards the divestment of Indonesia business and ~₹21 cr towards the acquisition of CauseWay Paints, Sri Lanka. These translated to a total exceptional loss of ₹363 cr during the year. PAT was further impacted by higher finance cost and increased depreciation expense. Tax rate for FY25 was 27.3%, owing to deferred tax adjustment and exceptional loss. 5 Year CAGR: 7.8%

#PAT #MARGIN

In FY25, PAT margin contracted to 10.5% from ~15% in FY24. However, excluding the exceptional items, PAT margin was at ~12%. The reduction is primarily owing to increased employee cost and depreciation & amortisation expense.

#ROCE

In FY25, ROCE declined to 27%. The decline can be attributed to weak operational performance and exceptional item impact. During the year, it added ~9,000 retail touchpoints across the country, taking the total to 1,69,000. It also expanded the Mysuru facility from 3,00,000 KL/per annum to 6,00,000 KL/ per annum.

#SECTOR POTENTIAL

• The domestic paint industry consisting of the decorative and industrial paint segment is estimated at over ~₹80,000 cr in FY25. The decorative paint segment constitutes 75% and industrial paint segment makes up the balance 25% of the domestic paint market. • The Indian coatings market is projected to achieve a revenue CAGR of 7.4% over the period 2025–2027, significantly outpacing the global coatings market, which is expected to grow at a CAGR of 3.9% during the same period. • 75% of the Indian paint industry is dominated by the organized players and rest by the unorganized players. Increased customer awareness has led to a shift in preference from unorganized to organized players, reducing dealer influence and making it imperative to establish a strong brand image. • The Indian paint industry, particularly the decorative segment, continued to face headwinds in FY25 due to heightened competition and subdued demand. The organized decorative paint sector recorded negative growth, impacted by intensified competition from both established and new players. Additionally, the year was marked by a slowdown in new construction activity, reduced renovation intensity, and weaker-than-expected B2B demand. Despite these headwinds, recent trends indicate early signs of recovery. • The Indian paint industry has been witnessing a gradual shift in the preferences of customers from the traditional whitewash to high-quality paints like emulsions and enamel paints, which is providing the basic stability for growth of Indian paint industry. • Crude oil forming an essential component of raw material for paint companies, any volatility in its price will need to be critically monitored to cushion the impact on profitability. Recently, the prices of crude oil saw a substantial decline. • The government has applied anti-dumping duty on Rutile (titanium dioxide) originating in or exported from China. • As per RBI (Reserve Bank of India) bulletin, rural demand is expected to continue the growth momentum and construction activity is poised to increase.

#FUTURE #OUTLOOK

• The company is investing towards VAM (vinyl acetate monomer) and VAE (vinyl acetate ethylene emulsion) in Dahej, Gujarat. Capex towards the same is ₹3,250 cr. This shall be partially operational by March-April 2026 and fully operational by April 2027. • A white cement plant is being set up in Fujairah, Dubai with an annual production capacity of ~2.75 lakh tonnes. The plant is expected to be operational by June 2025. • Towards the greenfield water-based paint manufacturing facility (Madhya Pradesh) with a capacity of 4 lakh kl per annum, the management stated that it has completed land acquisition (~166 acres); the statutory approval process is work in progress and they are targeting completion by CY28. The investment towards this would be ~₹2,000 cr. • The brownfield expansion in Ankleshwar, Gujarat is ongoing and will increase the plant’s capacity from 1,30,000 kilolitres (KL) in FY25 to 2,50,000 KL per annum. • On 14th February 2025, Asian Paints International Private Limited (APIPL), Singapore, a wholly-owned subsidiary, along with PTAPI (PT Asian Paints Indonesia) and PTAPCI (PT Asian Paints Color Indonesia), entered a share purchase agreement with Berger Paints Singapore Pte Limited, Singapore, for the sale of 100% stake in PTAPI and PTAPCI for consideration of SGD 7.5 million (~₹48 cr). The loss arising from the divestment was recorded as exceptional item in Q4 FY25. • The company aims to be in the top 2 player in the international markets, including Bangladesh and Sri Lanka. • Going forward, the B2B segment is expected to increase coupled with uptick in mid-luxury housing.

Asian Paints 2200-2400
Expected level 3000
Support 1900

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