ASIANPAINT

Regains Momentum After Four Muted Quarters

After four muted quarters,

’ India decorative paint business saw a sharp 10.9% year-on-year volume growth in Q2FY26. This rebound was driven by festive demand in September and early October, marking a turnaround from previous quarters where volume growth hovered near flat or negative. The recovery signals improved consumer sentiment and effective channel stocking ahead of the festive season. - Healthy Value Growth and Market Response Value growth stood at 6%, beating analyst expectations and reflecting pricing discipline alongside volume recovery. The stock rose 4% to a 52-week high of ₹2,897.10, indicating investor confidence. In contrast, Berger Paints posted 8.8% volume growth but only 1.1% value growth, suggesting Asian Paints maintained better pricing power and premium positioning. - Improved Profitability Metrics Consolidated revenue grew 6.3% YoY to ₹8,530 crore. Gross margin expanded by 242 basis points to 43.2%, aided by stable raw material costs. EBITDA margin rose 20 bps to 17.6%, and profit-before-tax margin jumped 450 bps to 9%, supported by operational efficiencies and exit from loss-making Indonesia operations. - International Business Gains Traction The international portfolio grew 9.9% in rupee terms and 10.6% in constant currency. Automotive coatings delivered 12% revenue growth YoY, reflecting recovery in global demand and better performance across geographies. These gains helped offset domestic volatility and added resilience to the overall business. - Strategic Portfolio Adjustments Asian Paints reduced prices on large packs and increased grammage in small packs to pass on GST rate cut benefits. With ~65% of its portfolio comprising low-unit packs (₹5/₹10), this move is expected to boost volume growth in coming quarters, especially in price-sensitive rural and semi-urban markets. While Q2 results signal recovery, future performance hinges on sustained demand, geopolitical stability, and raw material price trends.