11-11-2024 11:17 AM | Source: Reuters
India`s Asian Paints slumps after Q2 volume growth disappoints

Follow us Now on Telegram ! Get daily 10 - 12 important updates on Business, Finance and Investment. Join our Telegram Channel

Asian Paints' shares slumped on Monday, after the Indian paintmaker reported a second-quarter net profit on Saturday that nearly halved and a volume growth that disappointed some analysts.

The stock fell as much as 9.3% on the day and was the top percentage loser on the benchmark Nifty 50, which was down 0.3%.

Asian Paints' sales volumes, which declined 0.5%, were weaker than those of other large peers such as Berger Paints' 3.6% rise and Kansai Nerolac's 4% overall volume growth, said Morgan Stanley.

Product mix, rising rebates... and high selling expenses are key monitorables for Asian Paints, the brokerage added.

The paintmaker is India's largest in terms of market share.

In the reported quarter, the company's 5% decline in sales value came below estimates, Macquarie said. Comparatively, Berger's was largely flattish and Kansai posted a 5% drop, the brokerage added.

Asian Paints had flagged weak demand for its premium products in the previous quarters, as inflation-hit shoppers chose cheaper alternatives and intensifying competition in the sector forced players to cut prices.