Akzo Nobel India held a conference call on 23 May 2023 to discuss the results for the quarter ended March 2023 and way forward. Mr. Rajiv Rajgopal - Managing Director, Mr. Krishna R- Chief Financial Officer and Miss Harshi Rastogi - Company secretary and Compliance Officer of the company addressed the call.

Highlights of the Concall

• 10% revenue growth was led by robust demand from both segment in B2B and B2C in paint and coating

• The company saw faster growth in smaller towns compared to urban towns in retail business.

• In Q4, increased salience of new launches in premium category and network expansion in tier 3, 4 and 5 geographies led to growth in retail

• Benefit of prior pricing actions and softening raw material prices, supported by cost management initiatives drove improved profitability - both sequentially and on a year-on-year basis.

• Raw material prices have softened but there is still lot of uncertainty and volatility due to the Russia Ukrain war.

• Forex volatilities continue to persist. Currency beside crude oil plays a huge role in designing its prices.

• Premium segment grew significantly at high double digit. However it faced some challenges in some of the economy segments which it is addressing as they move forward.

• The company has received phenomenal orders from coastal and navy in Marine & Protective segment. Oil, gas and infrastructure segments have also done well. Power coatings saw strong growth in automotive GTC (General Trade Coaters) segments and Interpon Stone Effect range just got launched.

• In Industrial Coatings segment, coil was impacted during the quarter because of a high base and also lower exports, largely Sri Lanka. Packaging segment was driven by its consumer and ink business. Premium growth was seen in automotive.

• The company plans to increase its A&P expenses to around 3-3.5% of its sales from current 1.7% of sales to increase its visibility.

• The company is seeing a good buildup on its e-commerce platform and digitization. It is working on global CRM tools, IoT in its manufacturing sites and also digital-first approach for consumers and printers in order to create readiness as more players get into the market.

• Industrial business accounts for around 40% of total sales.

• The company targets to hold its current margins

• Current capacity utilization is around 60%