Berger Paints Q2 profit rises 5% on higher costs

Berger Paints India recorded a consolidated net profit of ₹217.1 crore for the September quarter. Revenue from operations increased by 13.2% to ₹3,200.4 crore during the same period. The profit growth was affected by rising raw material costs and increased advertisement spending, leading to squeezed margins. Consolidated earnings before interest, tax, depreciation and amortisation rose to ₹370.7 crore. The company implemented staggered price hikes to address ongoing raw material inflation.

Mumbai: Berger Paints India saw a little over 5% year-on-year growth in its consolidated net profit for the September quarter to ₹217.1 crore, while consolidated revenue from operations rose 13.2% to ₹3,200.4 crore.

Profit growth lagged revenue as raw material costs and higher ad spends squeezed margins. As a result, consolidated earnings before interest, tax, depreciation and amortisation rose 5.2% to ₹370.7 crore, while consolidated gross margins for the quarter stood at 39.3%.

"Operating profit growth was impacted by the sharp rise in raw material costs, the full impact of which was felt in this quarter," managing director Abhijit Roy said. "We successfully launched our new corporate campaign, "Rang Bona Rahe", which resulted in increased advertisement spends for the quarter," he said.

Berger Paints has taken continued price hikes in a staggered form to counter the sustained raw material inflation, the company said in a statement.