Asian Paints Q4 preview: Revenue likely to grow in double-digits, supported by volume growth

Asian Paints, which is slated to release its March quarter numbers on May 11, 2023, is likely to post a good set of numbers for the quarter that ended March 2023 (Q4FY23). According to ZEE Business Research, the company is expected to report a 12 per cent year-on-year (YoY) rise in consolidated revenue at Rs 8,810 crore against Rs 7,893 crore registered in the year-ago period. EBITDA or earnings before interest, tax, depreciation, and amortisation of the paint manufacturer is seen at Rs 1,737 crore, up 20 per cent against Rs 1,443 crore in the corresponding quarter of the previous fiscal. Ebitda margin is seen at 20 per cent against 18 per cent in March 2022 quarter. Net profit or profit after tax (PAT) is expected to increase 19 per cent YoY to Rs 1,153 crore.

Further, the company's volume is expected to grow between 11 - 12 per cent. The research house notes that softening in raw material prices is expected to aid gross margins and Ebitda margins. The company is also expected to gain from the company's product mix. Spending on advertising and promotion (A&P), and urban and rural trends will be key things to watch out for. 

ICICI Securities expects Asian Paints to report revenue growth of nearly 10 per cent YoY to nearly Rs 8,679 crore in Q4FY23E supported by volume growth of nearly 13 per cent YoY. "We believe volume growth is on the back of a favourable base and recovery in demand for decorative paints. On the margins front, we build in EBITDA margin expansion of 79 bps YoY to 19.1 per cent on account of improvement in gross margin amid benign raw material prices. The company is likely to report PAT growth of nearly 27 per cent YoY to nearly Rs 1,111 crore, tracking improvement in EBITDA margin and base effect. The base period included a one-time exceptional loss of Rs 116 crore

At the bourses, shares of Asian Paints have remained flat in the last year on NSE. In comparison, the benchmark Nifty has gained 12 per cent during the window, Trendlyne data show.