Paint makers expect uptick in sales, volume in Q3 as they see improvement in margins

New Delhi: India’s leading paint manufacturers expect a recovery in sales and volumes in the ongoing quarter, supported by early signs of demand revival and improved margins driven by softer input costs.

However, companies also anticipate heightened competition, especially after a phase of aggressive discounting triggered by new entrants. Several firms have implemented cumulative price hikes of 1.5–2 per cent to restore pricing discipline.

Asian Paints, Kansai Nerolac, Berger Paints, and AkzoNobel India noted in their recent earnings calls that the extended monsoon weighed on second-quarter performance, though demand picked up from September. With expectations of a stronger second half of FY26—helped by a favourable monsoon, GST rate corrections, and seasonal factors—paint makers plan to continue investing in innovation, advertising, and promotions.

They also expect margins to improve in November and December as raw material prices remain benign.

Asian Paints MD & CEO Amit Syngle said industry growth in Q2 was modest at 3.5–4 per cent, affected by heavy rains and a shorter festive season. However, he pointed to “green shoots” emerging in September and October 2025. A strong marriage season, improved rural sentiment due to good monsoons, and GST benefits should support demand, he said, while cautioning that the broader environment warrants conservative expectations over the next few months.

Asian Paints reported sales of Rs 8,513.70 crore in Q2 FY26, up 6.38 per cent year-on-year.

Kansai Nerolac also faced prolonged rain disruptions but saw a slight improvement late in September.

Managing Director Pravin Chaudhari said he expects consumption to strengthen in the second half of the year, aided by supportive economic policies. While October may have posed challenges, he is hopeful of better demand in November and December, and a stronger Q4 for both decorative and industrial segments.

Chaudhari added that Kansai Nerolac is maintaining a balanced portfolio and focusing on profitable markets amid heavy competition in the decorative paint segment.

The company reported an 11.3 per cent rise in consolidated net profit to Rs 133.31 crore in Q2, while revenue remained flat at Rs 1,954.18 crore.

Berger Paints India MD & CEO Abhijit Roy also anticipates better sales in November and December, supported by pent-up demand and steady improvement in margins driven by favourable raw material prices and an enhanced product mix.

On competition, Roy said the intensity has stabilised, and the market share gains made by new players are likely to moderate going forward. Berger’s revenue rose 1.9 per cent to Rs 2,827.49 crore in Q2, although net profit declined 23.5 per cent to Rs 206.4 crore. AkzoNobel India CMD Rajiv Rajgopal said the sector has undergone a cumulative price correction of 1.5–2 per cent amid aggressive competitive pricing.

He expects the next quarter to deliver double-digit volume growth and high single-digit revenue growth. Together, Asian Paints, Berger Paints, and Kansai Nerolac command over three-fourths of India’s paint market. The sector has seen several new entrants over the past five to six years, including Pidilite’s Haisha Paints, Grasim’s Birla Opus, and JSW Paints, intensifying competition in both decorative and industrial categories.