Paint companies rise in a muted market session, Berger Paints is up nearly 3 percent today after company's MD & CEO Abhijit Roy told CNBC-TV18 on Monday that they should cross-market share of 20 percent by the end of this year. "Rural demand has revived, expect Q4 volume & value growth to be in double digits," he said.
The paints sector is a crude-sensitive space & a recent drop in crude prices has also aided the outperformance of paint companies in today’s trade, crude prices dropped below $83 per bbl last night & are down nearly 5 percent YTD. “The effect of crude fall will reflect fully in Q4 FY23 in our gross profit margin,” Roy says.
Berger Paints saw weakness in Q3 due to extended monsoon & short festive season with a slight recovery seen in December. Companies domestic Volume growth was at 6.6 percent in Q3 with margin contracting by more than 200 bps on a year-on-year (YoY) basis.
Its biggest competitor Asian Paints, a market leader in this space, also expects its margin to improve going ahead, Amit Syngle told CNBC-TV18 last month.
The company also recently entered into an MoU with Gujarat government to set up a manufacturing facility at Dahej for Vinyl Acetate Ethylene Emulsion (VAE) & Vinylacetate Monomer (VAM).
Both Asian Paints & Berger Paints are up nearly 4 percent this month.
(Edited by : Sangam Singh)
First Published: Feb 28, 2023 12:59 PM IST
