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Kansai Nerolac Paints has reported over two-fold increase in standalone net profit at Rs 122.7 crore for the quarter ended March 31, 2013.
This is against standalone net profit of Rs 44.9 crore in the corresponding period last fiscal, Kansai Nerolac said in a statement.
Profit before tax (PBT) was at Rs 181 crore, up 178.9 per cent, due to one-time effect of depreciation write back of Rs 114.9 crore, on account of a change in accounting procedure, it added.
Net sales for the reported quarter stood at Rs 684.2 crore, up 2.6 per cent, as compared to Rs 666.8 crore over the same period of the previous year.
However, sequentially, net sales were lower as the same stood at Rs 766.6 crore in the October-December 2012 quarter.
“There is definitely a slow-down in demand and more so in the automotive and industrial sector. While there has been some reduction in interest rates, the industry is yet to see this translate into better demand,” Nerolac Managing Director H M Bharuka said.
Raw material inflation continued, along with exchange rate volatility and the working capital cycle also continues to be under stress, he added.
“The short term outlook therefore continues to be cautious. However, going forward, we feel that with reduction in commodity prices, there will be a positive impact for the industry,” Bharuka said.
The size of domestic paint industry is estimated at Rs 26,000 crore as of March 2012.
Good growth in infrastructure, core sector as well as automobile and real estate is likely to have a positive effect on overall demand for the industry, the company said.
“Overall, the picture of paint demand remains very positive over the long term,” Bharuka added.
For the fiscal ended March 31, 2013, standalone net profit stood at Rs 292.2 crore, up 35.3 per cent from Rs 215.9 crore registered in FY2011-12.
Net sales in 2012-13 were up 9.8 per cent to Rs 2,856.6 crore as against Rs 2,600.6 crore in the previous fiscal.
The company’s board has recommended a dividend of 110 per cent of Rs 11 per share, the company statement said.
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