Berger Paints India (BERGEPAINT) Q2 25/26 earnings summary

Executive summary

• Q2 FY26 saw high single-digit volume growth (8.8%) but muted value growth (1.1%) due to extended monsoon, impacting premium product sales and causing downtrading toward economy emulsions.

• Sales momentum improved late in September as weather stabilized, with expectations for stronger performance in Q3 and Q4.

• Construction Chemicals and Wood Coatings segments registered robust growth, while Decorative business saw muted value growth.

• Consolidated revenue for Q2 FY26 rose 1.9% year-over-year to ₹2,827.5 crore; standalone revenue increased 1.1% to ₹2,458.5 crore.

• Consolidated net profit for Q2 FY26 declined 23.5% to ₹206.4 crore; standalone net profit fell 23.0% to ₹176.3 crore.

Financial highlights

• Standalone total income from operations grew 1.1% year-over-year in Q2; operating profit declined by 18.8%.

• Consolidated EBITDA for Q2 FY26 was ₹352.3 crore, down 18.9% year-over-year; standalone EBITDA was ₹311.2 crore, down 18.8%.

• Gross margin dipped by 0.8% to 39.6% due to adverse product mix; operating margin shrank to 12.7%.

• PAT for Q2 FY26 declined 23% year-over-year; H1 FY26 consolidated revenue up 2.8%, PAT down 16.4%.

• Net cash stood at INR 636 crore at September-end after a dividend payout of INR 443 crore.

Outlook and guidance

• Expectation of double-digit volume growth in November and December, with Q3 value growth in mid-single digits and higher volume growth.

• Margin guidance maintained at 15%-17% for Q3, with Q4 expected toward the higher end.

• Gross margin expected to improve by 1.5% in H2 due to benign raw material prices.

• Demand revival anticipated post-Diwali, supported by pent-up demand and improved weather.

• Continued investments in brand, manpower, and retail network to capture demand.