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Berger Paints sees competitive pressure but expects stronger Q2
The company said it plans to add 10,000 tinting machines in FY27 and expects Q2 volume and price growth of 7% to 8% each.
Berger Paints reported June quarter performance that was solid but trailed rival Asian Paints on some measures, with both companies acknowledging heightened competition in the decorative paints market as newer entrants such as Birla Opus gain traction, according to LiveMint Markets.
Berger said consolidated revenue rose 12% year on year to ₹3,583 crore, supported by price hikes and volume. Decorative paints volumes increased 8.4%, compared with Asian Paints' 9%, while traction in high-margin emulsions and construction chemicals helped value growth of 13.5%. The firm also cited input cost inflation and delayed price hikes in industrial paints for a gross margin decline to 40.9%, versus margin strength at Asian Paints.
Looking ahead, Berger expects Q2FY27 revenue growth to improve versus Q1, helped by volume and price growth of 7% to 8% each, and said double-digit revenue growth is likely to continue through FY27 with distribution expansion, product launches, and festive demand from late Diwali. It reiterated high single-digit volume growth expectations for FY27 and reported EBITDA margin expansion to 16.9% on operating leverage and cost control.
Berger also detailed capacity and market expansion plans, saying it added 2,100 tinting machines in Q1 and aims to add 10,000 in FY27. The company’s FY27 operating margin guidance remains at 15% to 17%, with analysts cited by LiveMint Markets expecting Q2FY27 operating margin to expand year on year and notes that competition could remain an overhang despite Berger saying Birla Opus pricing is now at par with the industry.