Akzo Nobel India held a conference call on 04 November 2023 to discuss the results for the quarter ended September 2023 and way forward. Mr. Rajiv Rajgopal - Managing Director, Mr. Krishna R- Chief Financial Officer and Whole time Director of the company addressed the call.

Highlights of the Concall

• Revenue grew 3% to Rs 956.3 crore led mostly by B2B segment projects in paints and the coating business as retail sales was relatively muted.

• Gross margins improved 600 bps which was mainly attributed to easing of raw material costs coupled with favourable mix.

• The company mentioned that its paints business is now almost on a negative workling capital which supports healthier cash flows.

• The company has grown in its paint portfolio in rural areas in Q3 which is largely due to its distribution efforts which was ongoing for almost a year and a half. But the company rural portfolio has a samll base compared to its competitors.

• The company mentioned that it was second fastest growing paint company in India in last year.

• The company felt that it might have lost some market share in mass market which consitutes abiut 35% of total market but expect that it has grown its market share in other segment although marginally.

• The company mentioned that it is seeing slowdown in demand as earlier paint business used to grow 1.2 to 1.5 times of GDP but in last six months paints growth is half of GDP growth. The company expects demand to pick up after general elections next year.

• Contribution from new products was around 10%.

• Projects business contributes about 20% of decorative business.

• The company has grown in high single digit in Industrial segment

• The company expects significant improvement in market share in next three years.