Capitaline

Results 04-Nov-22

Analysis

Akzo Nobel India

Double-digit topline growth

Akzo Nobel India consolidated net sales increased 25.03% to Rs 926.2 crore in Q2FY23 compared to Q2FY22. Operating profit margin has declined from 12.81% to 11.49%, leading to 12.15% rise in operating profit to Rs 106.40 crore. Raw material cost as a % of total sales (net of stock adjustments) increased from 58.72% to 60.45%. Purchase of finished goods cost fell from 4.47% to 2.34%. Employee cost decreased from 8.20% to 7.90%. Other expenses rose from 16.89% to 18.16%.

Other income rose 54.34% to Rs 4.8 crore. PBIDT rose 13.49% to Rs 111.2 crore. Provision for interest rose 14.86% to Rs 3.4 crore.

PBDT rose 13.45% to Rs 107.8 crore. Provision for depreciation fell 0.61% to Rs 19.6 crore.

Profit before tax grew 17.13% to Rs 88.20 crore. Share of profit/loss were nil in both the periods. Provision for tax was expense of Rs 22.8 crore, compared to Rs 19.58 crore. Effective tax rate was 25.85% compared to 26.00%.

Minority interest was nil in both the periods. Net profit attributable to owners of the company increased 17.37% to Rs 65.40 crore.

Equity capital decreased from Rs 45.54 crore as of 30 September 2021 to Rs 45.50 crore as of 30 September 2022. Per share face Value remained same at Rs 10.00.

Promoters’ stake was 74.76% as of 30 September 2022 ,compared to 74.76% as of 30 September 2021 .

Sharing an overview on the second quarter performance, Rajiv Rajgopal, Managing Director, Akzo Nobel India said,

“The double-digit topline growth across paints and coatings was led by pricing actions and marketing campaigns for key propositions ahead of festive season. Our focus continues to be on improving margins and cost rationalization. Decorative paints momentum was led by premium portfolio, robust demand from urban geographies and the conducive real estate sector providing tailwind to projects. Improved demand from infrastructure, oil and gas, automotive and architecture drove coatings growth."

For year-to-date (YTD) results analysis

Net sales of Akzo Nobel India have increased 36.33% to Rs 1863.9 crore. Operating profit margin has declined from 13.56% to 12.21%, leading to 22.70% rise in operating profit to Rs 227.50 crore. Raw material cost as a % of total sales (net of stock adjustments) increased from 51.72% to 58.05%. Purchase of finished goods cost fell from 9.58% to 4.27%. Employee cost decreased from 8.68% to 7.92%. Other expenses rose from 17.29% to 17.88%.

Other income fell 30.69% to Rs 8.9 crore. PBIDT rose 19.24% to Rs 236.4 crore. Provision for interest rose 2.65% to Rs 5.8 crore.

PBDT rose 19.73% to Rs 230.6 crore. Provision for depreciation rose 3.16% to Rs 38.9 crore.

Profit before tax grew 23.77% to Rs 191.70 crore. Share of profit/loss were nil in both the periods. Provision for tax was expense of Rs 49.4 crore, compared to Rs 23.26 crore. Effective tax rate was 25.77% compared to 15.02%.

Minority interest was nil in both the periods. Net profit attributable to owners of the company increased 8.11% to Rs 142.30 crore.

Equity capital decreased from Rs 45.54 crore as of 30 September 2021 to Rs 45.50 crore as of 30 September 2022 . Per share face Value remained same at Rs 10.00.

Promoters’ stake was 74.76% as of 30 September 2022 ,compared to 74.76% as of 30 September 2021 .

Full year results analysis

Net sales of Akzo Nobel India has increased 30.03% to Rs 3148.6 crore. Operating profit margin has declined from 14.07% to 13.74%, leading to 26.91% rise in operating profit to Rs 432.50 crore. Raw material cost as a % of total sales (net of stock adjustments) increased from 47.82% to 54.79%. Purchase of finished goods cost fell from 7.12% to 5.99%. Employee cost decreased from 10.33% to 8.15%. Other expenses fell from 20.75% to 17.71%.

Other income fell 2.16% to Rs 22.7 crore. PBIDT rose 25.05% to Rs 455.2 crore. Provision for interest rose 40.78% to Rs 14.5 crore. Loan funds rose to Rs 70.50 crore as of 31 March 2022 from Rs 63.90 crore as of 31 March 2021. Inventories rose to Rs 664.40 crore as of 31 March 2022 from Rs 488.20 crore as of 31 March 2021. Sundry debtors were higher at Rs 495.50 crore as of 31 March 2022 compared to Rs 413.10 crore as of 31 March 2021. Cash and bank balance declined from Rs 733.20 crore as of 31 March 2021 to Rs 458.50 crore as of 31 March 2022.

PBDT rose 24.60% to Rs 440.7 crore. Provision for depreciation rose 0.53% to Rs 75.9 crore. Fixed assets increased to Rs 556.60 crore as of 31 March 2022 from Rs 553.20 crore as of 31 March 2021. Intangible assets declined from Rs 6.30 crore to Rs 5.20 crore.

Profit before tax grew 31.13% to Rs 364.80 crore. Share of profit/loss were nil in both the periods. Provision for tax was expense of Rs 76.7 crore, compared to Rs 70.6 crore. Effective tax rate was 20.91% compared to 25.38%.

Minority interest was nil in both the periods. Net profit attributable to owners of the company increased 39.74% to Rs 290.10 crore.

Equity capital stood at Rs 45.50 crore as of 31 March 2022 to Rs 45.50 crore as of 31 March 2021. Per share face Value remained same at Rs 10.00.

Promoters’ stake was 74.76% as of 31 March 2022 ,compared to 74.76% as of 31 March 2021 .

Cash flow from operating activities decreased to Rs 121.40 crore for year ended March 2022 from Rs 283.20 crore for year ended March 2021. Cash flow used in acquiring fixed assets during the year ended March 2022 stood at Rs 63.40 crore, compared to Rs 28.10 crore during the year ended March 2021.

The scrip trades at Rs 2109

Akzo Nobel India : Consolidated Results
Particulars	2209 (03)	2109 (03)	Var.(%)	2209 (06)	2109 (06)	Var.(%)	2203 (12)	2103 (12)	Var.(%)
Net Sales	926.20	740.79	25	1863.9	1367.17	36	3,148.60	2,421.40	30
OPM (%)	11.5	12.8		12.2	13.6		13.7	14.1
OP	106.40	94.87	12	227.5	185.41	23	432.5	340.8	27
Other Inc.	4.80	3.11	54	8.9	12.84	-31	22.7	23.2	-2
PBIDT	111.20	97.98	13	236.40	198.25	19	455.2	364	25
Interest	3.40	2.96	15	5.8	5.65	3	14.5	10.3	41
PBDT	107.80	95.02	13	230.60	192.6	20	440.7	353.7	25
Depreciation	19.60	19.72	-1	38.9	37.71	3	75.9	75.5	1
PBT	88.20	75.3	17	191.70	154.89	24	364.8	278.2	31
Share of Profit/(Loss) from Associates	0.00	0		0	0		0	0	-
PBT before EO	88.20	75.3	17	191.70	154.89	24	364.8	278.2	31
EO Income	0.00	0		0	0		2	0	-
PBT after EO	88.20	75.3	17	191.70	154.89	24	366.8	278.2	32
Taxation	22.80	19.58	16	49.4	23.26	112	76.7	70.6	9
PAT	65.40	55.72	17	142.30	131.63	8	290.1	207.6	40
Minority Interest (MI)	0.00	0		0	0		0	0	-
Net profit	65.40	55.72	17	142.30	131.63	8	290.1	207.6	40
EPS (Rs)*	#	#		#	#		63.4	45.6
Notes
* EPS is on current equity of Rs 45.54 crore, Face value of Rs 10, Excluding extraordinary items.
# EPS is not annualised
bps : Basis points
EO : Extraordinary items
Figures in Rs crore
Source: Capitaline Corporate Database

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