Berger Paints, the country’s second-largest paint-maker, is eyeing “higher than mid-teen” value growth in the second half of this fiscal, driven by recovery in the decorative paints segment.

The company continues to witness better-than-expected sales growth across upcountry markets and agri-belts. In the city and Tier-I markets, which have returned to pre-Covid-19 levels, demand is being witnessed for premium and niche offerings like safe and express painting services.

Softer crude prices and less pressure on raw materials have also led to improved margins for the company.

Also read: Berger Paints sees recovery in urban markets

According to Abhijit Roy, MD and CEO, Berger Paints India Ltd, apart from pent-up demand, good monsoons and higher agriculture income have aided recovery in the decorative paints segment during the just concluded September quarter. Initial indications point out that the sales pick-up has continued through the festival season into Q3 (October to December period). Secondary sales, which include sales from shops to end users are at “much higher than pre-Covid-19 levels”.

In the upcountry market, economy segment offerings like primer, distemper, putty and other mass priced products have done well, compared to premium products.

“Value growth in decorative paints is expected to be higher than mid-teens for Q3, and Q4 (Jan-March) will also have the lower base effect of last year. We believe the current upswing witnessed in upcountry markets is sustainable. Rural markets are growing faster. In urban markets, growth has come back to pre-Covid-19 levels,” he told BusinessLine .

Urban markets

In the urban markets, there continues to be some “hesitancy” on spending. However, niche and premium offerings like safe and express painting solutions and waterproofing solutions have seen traction in metros.

Incidentally, adjacent offerings like surface disinfectant sprays are also witnessing some traction across online and general trade channels. Distribution is being ramped up.

“Some of the premium offerings like waterproofing solutions through usage of moisture meters or our express painting service have gained traction in metros. We are also spending on advertisements and roping in brand ambassadors to promote the new services and the adjacent products that we entered into recently,” Roy said.

Also read: Akshay Kumar to be brand ambassador for Berger Paints

Non-decorative paints

In the industrial paint categories, automotive paint is witnessing recovery across select categories following a return in demand for passenger vehicles and two-wheelers. Tractor sales are also picking up. However, some other categories like commercial vehicles and three-wheeler sales continue to be “slow” and are “below last year’s levels”.

“Protective paints are witnessing moderate growth, while select categories in automotive paints are witnessing recovery. It’s a mixed bag as of now in the non-decorative paints segment,” he added.

Berger’s turnover is skewed primarily in favour of decorative paints.

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