Equity

Corporate Results

Asian Paints
(23-Oct-2019, 09:29 Hours IST)  
Asian paints consolidated net sales rose 9% to Rs 5050.66 crore for the quarter ended September 2019 compared to corresponding previous year period. The company operating margins rose 60 bps to 18.9%. As a result operating profit growth rose 13% to Rs 954.82 crore. Cost of raw material consumed as a percentage of net sales (net of stock adjustment) fell 260 bps to 52.4% while purchase of stock in trade rose 120 bps to 7.2%, employee benefit expense rose 20 bps to 6.6% and other expense increased 110 bps to 15.9%.

Other income of the company rose 62% to Rs 105.16 crore. Interest cost increased 1% to Rs 25.94 crore. Depreciation rose 37% to Rs 197.17 crore. PBT as a result rose 13% to Rs 836.87 crore. The effective tax rate fell to 0.9% compared to 32.8% as it has chosen to exercise the option of lower tax rate of 25.17% (inclusive of surcharge and cess) under section 115BAA of the Income Tax Act, 1961 as introduced by the Taxation Laws (Amendment) Ordinance 2019 owing to which the company's PAT rose 67% to Rs 829.64 crore. Considering share of profit of associate net profit and minority interest net profit increased 68% to Rs 823.41 crore.

Consolidated half year ended Performance

For half year ended September 2019, net sales rose 13% to Rs 10155.38 crore compared to corresponding previous year period. The company operating margins rose 100 bps to 20.8%. As a result operating profit growth was 19% to Rs 2112.76 crore. Other income of the company rose 41% to Rs 178.68 crore. Interest cost increased 13% to Rs 52.6 crore. Depreciation increased 40% to Rs 388.92 crore. PBT as a result rose 17% to Rs 1849.92 crore. The effective tax rate decreased 1360 bps to 19.4% owing to which the company's PAT rose 41% to Rs 1491.61 crore. Considering share of profit of associate and minority interest net profit increased 41% to Rs 1478.85 crore.

The Board of Directors approved the payment of an interim dividend of Rs 3.35 per share (335%). The company distributed an interim dividend of Rs 2.85 per share (285%) for FY 2018-19. Total dividend of Rs 10.50 per share (1050%) was distributed for FY 2018-19. The dividend payout ratio was 56.8% for FY 2018-19.

Management comments

The decorative business segment in India registered a high double digit volume growth, though lower than that witnessed in the first quarter. Automotive coatings JV (PPG-AP) business continued to be impacted by the slowdown in the automobile industry and even the Industrial Coatings JV (AP-PPG) business was impacted by demand slowdown. The entire coatings business, however, benefited from the benign raw material price environment. International operations performed better than the previous quarter with improvement in the key units of Nepal and Egypt. Both the segments in the Home Improvement category viz. the Kitchen (Sleek) and Bath (Ess Ess) business, were impacted by the slowdown in the real estate construction space.said K.B.S. Anand, Managing Director & CEO, Asian Paints Limited.

The scrip is currently trading at Rs 1779

Asian Paints: Consolidated Results

 

1909 (3)1809 (3)Var (%)1909 (6)1809 (6)Var (%)1903 (12)1803 (12)Var (%)
Net Sales5050.664615.49910155.388985.591319341.5216824.5515
OPM (%)18.918.320.819.819.519.0
OP954.82844.7132112.761774.71193762.113197.6118
Other Inc.105.1664.8662178.68126.5241233.05220.626
PBDIT1059.98909.56172291.441901.23213995.163418.2317
Interest25.9425.74152.646.613105.6535.07201
PBDT1034.04883.82172238.841854.63213889.513383.1615
Dep.197.17143.6137388.92278.640625.62360.4774
PBT 836.87740.21131849.921576.03173263.893022.698
Tax7.23242.45-97358.31518.85-311096.581040.965
PAT829.64497.76671491.611057.18412167.311981.739
P/L from discontinued business-2.88-1.00-4.95-1.920.0070.00-100
Share of P/L in JV.15.387.989327.5719.514140.7345.79-11
Minority int.18.7313.164235.3826.333452.1258.59-11
Net profit823.41491.58681478.851048.44412155.922038.936
EPS (Rs)*####22.521.3
*Annualised on Equity Share Capital Rs 95.92 crore; Face value Rs 1
EO: Extraordinary items, Var.(%) exceeding 999 is restricted to 999
EPS is calculated after excluding EO and relevant tax
Figures in Rs crore
Source: Capitaline Database

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