Berger Paints Q3 net down -8.03% yoy at Rs252.72cr on sharp spike in raw material costs in Q3

9 Feb 2022 , 11:08 PM

Berger Paints reported 20.42% yoy growth in total sales revenues for the Dec-21 quarter on consolidated basis at Rs2,550.77cr. On a sequential basis, the revenues were up by 14.64%.

During the December 2021 quarter, Berger Paints saw good traction in its core decorative paints business as well as its home solutions business. The pressure on the company came from the input costs.

The debt equity ratio in the quarter is up from 0.05 to 0.15 in the quarter. The current ratio saw depletion of 1.72 to 1.44 during the latest quarter. In the middle of the quarter, Berger Paints saw impact of COVID on paint demand as it had hit construction especially in the Northern part of India.

For the Dec-21 quarter, the operating profits were down -7.20% at Rs336.06cr. During the quarter, the consolidated EBITDA margins came in at 13.04% compared to 17.80% in the year ago quarter and marginally lower than the 13.16%. 

EBITDA margins recorded in the sequential Sep-21 quarter. However, lower profits and higher debt in the quarter meant that the coverage ratios went for a toss. For instance, the interest coverage ratio for the Dec-21 quarter came in at 29.03 times, much lower than the 63.04 times interest coverage recorded in Dec-20 quarter.

During the same period, the debt service coverage ratio also deteriorated from 2.31 times to just about 0.62 times on a comparable yoy basis.

Net Profit after tax (PAT) for the Dec-21 quarter was down -8.03% yoy at Rs252.72cr on the back of higher operating costs in the quarter. During the Dec-21 quarter, the cost of material inputs were up 30.5% at Rs1,422cr.

During the quarter, the debtors turnover ratio and the inventory turnover ratio also showed deterioration on a yoy basis, putting greater pressure on the working capital cycle. PAT margins tapered from 12.97% in the Dec-20 quarter to 9.91% in the Dec-21 quarter. The PAT margins were higher by 7 bps on a sequential basis.

Financial highlights for Dec-21 compared yoy and sequentially

	Berger Paints
Rs in Crore	Dec-21	Dec-20	YOY	Sep-21	QOQ
Total Income (Rs cr)	₹ 2,550.77	₹ 2,118.19	20.42%	₹ 2,225.01	14.64%
Operating Profit (Rs cr)	₹ 336.06	₹ 362.12	-7.20%	₹ 298.10	12.73%
Net Profit (Rs cr)	₹ 252.72	₹ 274.80	-8.03%	₹ 218.85	15.48%
Diluted EPS (Rs)	₹ 2.60	₹ 2.83		₹ 2.25
Operating Margins	13.17%	17.10%		13.40%
Net Margins	9.91%	12.97%		9.84%