BENGALURU (Reuters) – India’s Asian Paints on Thursday reported a smaller-than-expected jump in second-quarter profit, hurt by muted demand due to a patchy monsoon and late festive season, sending its shares down nearly 2%.
The country’s top paint maker said its domestic decorative paints business, which accounts for more than 80% of the revenue, was ‘muted’ during the quarter.
Shares of Asian Paints, which is part of the blue chip Nifty 50 index, fell as much as 3.5% to 2,952.80 rupees after the results.
“The erratic monsoon impacted market sentiment potentially leading to deferment of sales to October given the late Diwali this year,” Chief Executive Officer Amit Syngle said in a statement.
A drop in expenses and moderating raw material prices helped ease the company’s margins and aided it in posting a 54% rise in net profit to 12.05 billion rupees ($144.86 million), but fell short of analysts’ estimate of 12.42 billion rupees, as per LSEG data.
The Mumbai-based company’s revenue from operations was largely flat, with a 0.3% rise to 84.79 billion rupees.
“Looking towards the second half of the year, we remain optimistic about improved demand conditions well supported by the longer festive season and the overall buoyant domestic economic growth,” Syngle added.
($1 = 83.1830 Indian rupees)
(Reporting by Ashish Chandra in Bengaluru; Editing by Sonia Cheema)