Berger Paints sees stronger Q2 demand as Q1 revenue rises 25%; adds 10,000 tinting machines
Berger Paints reported June-quarter revenue of Rs 3,584 crore and net profit of Rs 404 crore, aided by projects and construction chemicals. It expects 7.5%-8% volume growth in the September quarter, supported by favourable comparisons and pricing, while Morgan Stanley remains cautious with a Rs 429 target.
What happened
Berger Paints India · Berger Paints expects September-quarter growth to improve on favourable comparisons and price hikes. Q1 revenue and profit rose sharply,
Key facts
- Q1 net profit Rs 404 crore, up 20.6% QoQ
- Q1 revenue Rs 3,584 crore, up 25% QoQ
- Q1 EBITDA Rs 607.5 crore, up 26.1% QoQ
- Q1 EBITDA margin 17% versus 16.8% QoQ
- Morgan Stanley target price Rs 429, implying 20% downside
- September-quarter volume growth guidance 7.5%-8%
- Pricing support around 8%
- FY27 EBITDA margin guidance 15%-17%
- 10,000 tinting machines planned this year; 2,100 installed in Q1
Why this matters
Berger’s planned 10,000-machine tinting rollout and construction-chemicals traction make dealer-tech partnerships, distribution expansion, and adjacent building-material opportunities strategic priorities.
What to watch
- Q2 volume growth versus the guided 7.5%-8% range and whether growth remains volume-led rather than price-led.
- Tinting-machine installation pace after the initial 2,100 units and utilisation/reorder rates at equipped dealers.
- Gross-margin movement versus Q1, especially amid crude-linked monomer, solvent and titanium dioxide cost changes.
- Competitive price cuts, dealer incentive intensity and market-share commentary from Asian Paints, Kansai Nerolac and Indigo Paints.
- Project pipeline conversion, construction-chemical growth and monsoon impact on repainting and construction activity.
- Management commentary on rural demand, premium-product mix and working-capital requirements from the expanded dealer network.
- Accelerate installation of the remaining tinting machines in high-potential urban, semi-urban and underpenetrated dealer clusters.
- Bundle paint tinting access with construction chemicals and waterproofing products to raise dealer wallet share and project-led revenue.
- Use the Q2 demand recovery to prioritise premium and waterproofing categories rather than broad-based discounting.
- Monitor dealer-level machine utilisation and remove or redeploy underutilised units to protect capital efficiency.
- Maintain raw-material hedging and selective price actions if crude derivatives or titanium dioxide costs rise.