Asian Paints (ASIANPAINT) Q2 24/25 earnings summary

Executive summary

• Q2 FY25 saw muted demand, with value declining 6.7% year-over-year, mainly due to price reductions, weaker product mix, and heightened competition, especially in the decorative business.

• H1 FY25 volumes grew 3.3%, but value declined 4.8% year-over-year, reflecting challenging market conditions and weak consumer sentiment.

• Urban centers experienced more stress, while rural areas showed relative resilience and recovery.

• Expansion of retail footprint continued, reaching 167,000 retail touchpoints.

• Audited standalone and unaudited consolidated financial results for the quarter and half year ended 30th September 2024 were approved, with an interim dividend of ₹4.25 per share declared for FY25.

Financial highlights

• Standalone Q2 FY25: Net sales ₹6,841 cr, gross margin 41.1%, PBDIT margin 16.4%, PAT ₹602 cr.

• Consolidated Q2 FY25: Net sales ₹8,003 cr, gross margin 40.6%, PBDIT margin 15.5%, PAT ₹694 cr.

• H1 FY25: Standalone net sales ₹14,693 cr, gross margin 42.1%, PBDIT margin 18.5%.

• H1 FY25: Consolidated net sales ₹16,946 cr, gross margin 41.5%, PBDIT margin 17.3%.

• Exceptional items in Q2 included impairment provisions and forex loss totaling over ₹280 cr.

Outlook and guidance

• Q3 is expected to remain challenging due to a high base and delayed festive season, but improvement is anticipated in Q4 with better monsoons and increased government spending.

• Full-year volume growth is expected to be in the single digits, with realization decline in the 5%-6% range.

• Margin guidance for H2 remains at 18%-20%, contingent on crude price stability and realization of price increases.

• Focus on core business, brand strengthening, and scaling industrial segments.

• International macroeconomic constraints persist, especially in Asia and Africa.