Kansai Nerolac tanks 7% as Q4 net profit slumps

NEW DELHI – Shares of Kansai Nerolac Paints slumped 6.5 per cent in early trade on Wednesday as investors expressed disappointment with a hefty decline in the company’s net profit in the last quarter of the previous financial year.

The paint manufacturer reported a decline of 84.49 per cent in its consolidated net profit to Rs 19.17 crore for the fourth quarter ended March. The company had posted a net profit of Rs 123.62 crore in the January-March quarter a year ago.

Kansai Nerolac’s counter dropped to a low of Rs 403 as against Rs 431.10 at previous close on the BSE.

However, the firms’ revenue from operations was up 5.27 per cent at Rs 1,536.60 crore during the quarter under review as compared to Rs 1,459.57 crore in the corresponding quarter of the previous year, PTI reported.

Kansai Nerolac's total expenses were at Rs 1,503.54 crore, up 15.47 per cent in Q4/FY 2021-22, as against Rs 1,302.06 crore in the year-ago period, PTI’s report said.

"The quarter witnessed impact in terms of demand for decorative on account of the steep price increase towards end of Q3FY 21-22. In automotive, passenger vehicles demand was good though impacted because of supply side constraints,” Kansai Nerolac Paints Managing Director Anuj Jain was quoted as saying in PTI’s report.

On raw material costs, the quarter continued to witness inflationary pressures along with volatility in crude and exchange rates on account of tough geopolitical situation globally.

For the fiscal year ended March 31, 2022, the company's consolidated net profit was down 34.72 per cent at Rs 343.15 crore. It had reported a net profit of Rs 525.72 crore in 2020-21.

Its revenue from operation was at Rs 6,369.35 crore in 2021-22. This was 25.52 per cent higher than Rs 5,074.25 crore in the year-ago period, PTI’s report said, adding that the company’s board has recommended a final dividend of Re 1 per share.