Q2 Results: Asian Paints’ Profit Beats Estimates Due To Tax Reversal Benefit
The paintmaker’s quarterly profit rose, beating street estimates on a deferred tax reversal.
Asian Paints Ltd.’s quarterly profit rose, beating street estimates on deferred tax reversal.
The paintmaker’s profit rose 67.5 percent over last year to Rs 823.40 crore in the quarter ended September, it said in a exchange filing. That compares with the Rs 677-crore consensus estimate of analysts tracked by Bloomberg. The company made a deferred tax reversal to the tune of Rs 149.7 crore in the current quarter.
Revenue rose 9.4 percent on a yearly basis to Rs 5,050.70 crore—analysts had forecast Rs 5,220.5 crore.
Operating income rose 13 percent over last year to Rs 954.80 crore during the quarter—the consensus estimate was Rs 1,021 crore. The company’s operating margin expanded to 18.9 percent from 18.3 percent—analysts had forecast 19.6 percent. The firm also opted for a lower tax rate of 25.17 percent, nearly a month after the government cut corporate taxes.
The board has also approved payment of interim dividend of Rs 3.35 per share.
Automotive coatings business continued to be impacted by slowdown in the automobile industry and even industrial coatings business was impacted by demand slowdown.KBS Anand, Managing Director & CEO, Asian Paints Limited
Key Managerial Changes:
- Chief Operating Officer Amit Syngle to succeed Chief Executive Officer KBS Anand, who will retire on March 31, 2020.
- Chief Financial Officer Jayesh Merchant, who will retire on Nov. 26, will be succeeded by Vice President (Finance) RJ Jeyamurugan.
Shares of Asian Paints declined 2 percent ahead of the earnings announcement. The stock has advanced 50.9 percent in the past year compared with a 16.1 percent gain in the NSE Nifty.