Berger Paints India sparkles with profitability and manufacturing expansion

Berger Paints India (BPIL) recently announced its June 2015 quarter results. The company's consolidated net sales increased by 5.73 per cent to Rs 1121 crore in Q1FY16 compared to same period in previous fiscal year. Its total expenditure increased by 2.74 per cent to Rs 972 crore in Q1FY16 on yearly basis. BPIL's total expenditure increased mainly due to a 7.04 per cent increment in other expense and 3.58 per cent increment in employee cost during the quarter.

BPIL's EBITDA boosted by 30.33 per cent to touch Rs 149.44 crore in Q1FY16 as compared to same period in previous financial year. The company's EBITDA margin expanded by 252 basis points to 13.33 per cent in Q1FY16 on yearly basis. Its EBIT too increased by 34.05 per cent to Rs 125.22 crore in Q1FY16 on yearly basis though its depreciation expense increased by 13.98 per cent to Rs 24.22 crore during the quarter. The PAT of the BPIL rose by 34.53 per cent to Rs 77.3 crore in Q1FY16 compared to same period in previous fiscal year. The PAT margin of the company expanded by 147 basis points to 6.89 per cent in Q1FY16 on yearly basis.

BPIL shareholding pattern indicates that FII holdings contracted by 64 basis points to 9.2 per cent and DII holdings expanded by 25 basis points to 2.42 per cent during June 2015 quarter. The share price of the company increased by 3.57 per cent on BSE and closed at Rs 227.3 on August 4,2015.

BPIL board members approved to put two factories in Assam. A putty and distemper manufacturing facility is to be put up by British Paints division and the other water and solvent based paint mixing plant by Berger division. Assam government is likely to allot two plots of land in two separate location, in Guwahati and in Tezpur, and the work at these two plants will start only on next financial year.

BPIL is second largest paint company in India. The Company products include Interior wall coatings, exterior wall coatings, metal and wood paints, living green, protective coating, undercoats and construction chemicals. Its Construction Chemical products include cement mix plus, crack fill paste, crack fill powder, latex plus, advance latex plus, tile adhesive and tile adhesive plus. BPIL's undercoat products include BP cement primer, BP white primer, weathercoat exterior primer and melamine sealer.