Asian Paints

Asian Paints reported a Q3 FY26 Decorative Business (India) volume growth of 7.9% and value growth of 2.8%. The overall coatings business, including industrial, saw an 8.3% volume growth and 4.4% value growth. This performance was achieved despite a shorter festive season and prolonged monsoon, with rural markets showing slightly better performance than urban centers. New products contributed approximately 16% to overall revenues, highlighting the success of innovation-led strategies.

The company's consolidated Gross Margin reached 44.3% in Q3 FY26, an increase of 200 bps YoY, while the standalone Gross Margin was 44.9%. This expansion was primarily attributed to material deflation of about 1.1% and sustained efforts in sourcing and formulation efficiencies. Despite lower mix and higher discounting, the strong cost model helped maintain and improve profitability, with consolidated PBDIT margin at 20.1% (up 90 bps YoY) and standalone PBDIT margin at 21.4% (up 100 bps YoY).

The industrial segment demonstrated strong performance, with the PPGAP joint venture (auto and general industrial) growing revenue by 17% in Q3 FY26 and achieving an all-time high PBT margin of 25.1% (up 300 bps YoY). The APPPG segment (protective paints, powder coatings, traffic paints) also recorded a 16% value growth. The B2B business, encompassing factories, hospitality, and government projects, outpaced retail growth and is expected to continue this trend, supported by infrastructure spending and private CapEx.

Asian Paints continued its aggressive brand-building initiatives, including a partnership with BCCI as the official 'Colour Partner' for Team India and collaborations with properties like KBC and Spotify. The 'Beautiful Home Painting Service' was highlighted as a key differentiator, leveraging AI for hyper-segmentation and improved NPS. Regionalization efforts, such as the 'Garv se Haryana' special edition pack, were successful in creating strong customer association, with such initiatives rolled out in 8-9 states.

The Home Decor network expanded to 74 'Beautiful Homes' stores across the country. Within this segment, Kitchen revenue grew by 2.6% to ₹105 crores, with PBT loss reduced to ₹4 crores. Bath revenue, however, declined by 4.1% to ₹84 crores but achieved PBT breakeven. White Teak and Weatherseal segments showed strong top-line growth, increasing by 12.4% to ₹29 crores and 58.6% to ₹19 crores respectively, indicating emerging strength in these categories.

The company reported exceptional item^📎s totaling ₹157.61 crores on a consolidated basis, primarily due to a ₹63.74 crore impact from Labour Code changes and a ₹93.87 crore impairment loss on intangibles related to Obgenix Software Private Limited (White Teak). For Q4 FY26, management aims to maintain high single-digit volume growth and expects competitive intensity to remain elevated. They anticipate industrial and B2B segments to continue outperforming retail, with geopolitical uncertainty and exchange rate volatility remaining key variables for input prices.