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Informist, Wednesday, Aug. 5, 2026

 

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--Berger Paints: Expect better revenue growth from arms Bolix and STP in Q2
--CONTEXT: Comments by Berger Paints mgmt in post-earnings call with analysts
--Berger Paints: More dry days in monsoon to help sales in Sept quarter
--Berger Paints: Expect 7.5%-8% volume growth in Sept qtr, lower than Apr-Jun
--Berger Paints: Revenue growth to be higher in Q2 compared to Q1
--Berger Paints: Expect price hikes of 7.5-8?ross portfolio in Sept qtr
--Berger Paints: Had good sales in Jul due to stocking, secondary sales
--Berger Paints: Took a price hike of around 5?ross portfolio in Apr-Jun
--Berger Paints: Don't see price hikes affecting volume growth in FY27
--Berger Paints: Expect operating margin expansion YoY in Sept quarter

 

By Eshitva Prakash and Shweta

 

MUMBAI – Berger Paints India Ltd. expects to deliver a strong September quarter with higher revenue growth and operating margin expansion on a year-on-year basis. Price hikes taken by the company, dealers stocking-up to shield themselves against price hikes, more dry spell in the monsoon this year, and low probability of price cuts in the near term will drive growth in the current quarter, its management said in a post-earnings conference call with analysts.

 

The company has guided for volume growth of 7.5-8.5% in the September quarter, which is sequentially lower. The September quarter is generally a low-volume growth phase for the company as monsoon affects paint demand exponentially. However, a weak monsoon this year has been favourable for the company and Berger Paints has already seen high growth in secondary sales and sales to dealers in July.

 

While price hikes have traditionally dented volume growth of the company, this year, the company expects a quick absorption of price hikes. The company took a price hike of around 5% across its portfolio in the June quarter, sharply lower than analysts' estimates. Analysts pointed out that at a dealer level, effective price hikes have been close to 12–13% for the quarter. These facts, when taken together, show the company surpassing Street expectations was more a function of strong underlying demand than just of price hikes. The company is planning a 7.5-8.0% price hike across its portfolio in the September quarter.

 

"We are taking many initiatives from our side as well to grow the volumes," its management said. "One is, of course, the expansion of the network itself, the second is the branding campaign, which we hope...will also have some energetic effect on the ground... so overall, some new product introductions, combination of all of these factors should help us to maintain the volumes," the management added. 

 

The company's optimism on margin expansion for the September quarter is dependent on the cost of raw materials, which has been volatile due to the war in West Asia. "If (paint) prices do not drop subsequently in terms of selling price drops, then, of course yes, the operating margin possibly will expand...there are too many ifs and buts but in the second quarter (Jul-Sept), I expect that the operating margin will grow at a decent pace," an official of the company said.

 

Berger Paints Thursday reported its June quarter results. Strong growth in the automotive and decorative paints segments coupled with robust value growth on the back of price increases drove the company's sales growth. The company's gross margin declined on year due to high raw material prices. The company's consolidated net profit for the June quarter jumped 28.5% on year to INR 4.04 billion, beating analysts' expectation. Its consolidated revenue for the June quarter grew around 12% on year to INR 35.84 billion, in line with the Street's estimates. 

 

The company said its volume growth in the June quarter was because the delta between volume ad value growth was less steep than in previous quarters, owing to higher product prices. A favourable product mix also helped deliver sales growth. "There is (are) some amount of construction chemical products which sell and the growth of those categories are much higher than normal products like tile adhesives. These are low value products but high volume products," an official said.

 

 

Going forward, the company sees elevated competition in the paint industry despite some easing in the June quarter. "It remains intense, and it remains challenging in terms of the intensity of competition. Except for the fact that, as I said, there was a 5% gap between the dealer price list itself between them and us and that has been neutralised so that prices have gone up to that extent," the management said.

 

Adding to its bullish outlook for the September quarter, the company said that its subsidiaries, Bolix Ltd. and STP Ltd. will also see a healthy growth. "I think the margins will be pretty okay as far as the subsidiaries are concerned. I think the businesses are now looking good," a company official said. "We have taken some corrective measures as I mentioned to correct the profitability angle," he said. The management expects these subsidiaries to "yield very good results" in the September and December quarters, after which, raw material prices will be the key tests of their profitability.    

 

Berger Paints also expects good traction in its non-paints business such as waterproofing, construction chemicals, industrial and protective coatings, and automotive finishes. These operations have generally been reporting higher sales growth than the paints business, although on a low absolute figure. Talking of its expansion plans, the company said work on its greenfield facility in Panagarh, West Bengal, will begin around the end of 2026-27 (Apr-Mar).

 

The company reported its earnings during market hours Wednesday. Its shares ended nearly 3% higher than Tuesday at INR 545.20 apiece on the National Stock Exchange.  End

 

Edited by Akul Nishant Akhoury

 

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