Asian Paints Ltd. expects the pace of price increases to accelerate in the current quarter from October to December as it seeks to offset rising input costs.
“We have never seen this kind of inflationary pressure in the past 40 years. On top of that, the problems with the supply of raw materials and higher transport costs are unprecedented”, Amit Syngle, director general and CEO of India’s largest paint maker, BloombergQuint’s Niraj Shah said in an interview.
Headline inflation has increased quarterly, according to Syngle. “We saw an almost 15% increase in inflation from the fourth quarter of fiscal 21 to the first quarter of fiscal 22. We saw another 6-7% increase when we entered the second. quarter and we have seen a further increase of around 3% so far in the third quarter, ”he said. noted.
Asian Paints, which globally increased its prices by around 7.5% in the June and September quarters, expects the impact of such measures to vary across its product portfolio.
Profits for India’s largest paint maker for the September quarter missed estimates due to higher input costs even as demand increased. Volume increased 34%, led by Tier 1 and Tier 2 centers, and value increased 35%. The growth in volume and value has been much closer because the company has focused more on the high-end and luxury range, Syngle said.
Other highlights from the interview:
Measures to improve formulation efficiency and innovative raw material sourcing strategies have helped reduce input cost pressures.
Consumer confidence has improved around the holiday season as fears of a third wave of Covid decline and a strong monsoon supports the rural economy.
Confident of double-digit volume growth over the next few quarters, although it may not be as high as in the second quarter.