**Berger Paints Anticipates Demand Recovery Amid Challenges**
**Meta Description:** Berger Paints India Ltd expects gradual demand recovery in the current fiscal quarter, despite recent challenges impacting profits.
**URL Slug:** berger-paints-demand-recovery
**Headline:** Berger Paints Projects Gradual Demand Recovery Following Recent Setbacks
Berger Paints India Ltd, the country’s second-largest paint manufacturer, is optimistic about a gradual recovery in demand and pricing in the ongoing fiscal quarter. This outlook follows early signs of recovery observed in the June quarter. The company faced challenges in the April-June period, including weak demand and a factory accident that led to a profit decline of over 11%.
Abhijit Roy, the managing director and CEO of Berger Paints, noted in a press statement that the sequential improvement in domestic demand indicators and the positive momentum in key markets are encouraging signs. Although inclement weather temporarily interrupted this progress, Roy believes a swift recovery is on the horizon.
Based in Kolkata, Berger Paints has successfully increased its market share, now holding over 20% among publicly listed paint manufacturers. However, the company has also highlighted potential risks, including volatile geopolitical conditions and uncertainties stemming from international tariff negotiations.
Analysts at ICICI Securities predict that the paint industry’s revenue growth will rebound in the fiscal year 2025-26 after a decline in FY25. Their analysis of the past two decades indicates a pattern where the industry typically experiences strong growth following two slow years. Given that FY24 and FY25 are expected to be slow, a robust recovery is anticipated in FY26 and FY27.
In the June quarter, Berger Paints reported a revenue increase of 3.55% year-on-year, reaching ₹3,201 crore, although this fell short of the ₹3,272 crore forecast by analysts. The company’s profit also declined by 11% to ₹315 crore, which included an exceptional loss of ₹37 crore due to a fire at its distribution center in Barasat, Kolkata. The fire, which originated from a neighboring facility, is currently under assessment for insurance claims.
The decorative segment of Berger Paints showed mid-single-digit volume growth, aided by an improved product mix and a reduced gap between sales volume and value, which narrowed to 3.6% from 7% a year earlier. The company’s earnings before interest, taxes, depreciation, and amortization (EBITDA) rose by 1.1% year-on-year to ₹528 crore in the June quarter, while raw material costs decreased by nearly 6% to ₹1,488 crore.
On the stock market, Berger Paints shares closed 1.7% higher at ₹571.70, contrasting with a 0.30% decline in the benchmark Nifty index.
**FAQ:**
**What factors are influencing Berger Paints’ recovery?**
Berger Paints is seeing a gradual recovery in demand due to improving domestic market indicators and momentum in key markets, despite challenges like inclement weather and geopolitical uncertainties.
