Capitaline

Results 03-Aug-23

Analysis

Akzo Nobel India

Growth momentum continues

Akzo Nobel India consolidated net sales increased 6.56% to Rs 999.2 crore. Operating profit margin has jumped from 12.91% to 16.22%, leading to 33.86% rise in operating profit to Rs 162.10 crore. Raw material cost as a % of total sales (net of stock adjustments) decreased from 55.65% to 51.95%. Purchase of finished goods cost fell from 6.18% to 4.76%. Employee cost increased from 7.93% to 8.38%. Other expenses rose from 17.59% to 18.59%.

Other income rose 100% to Rs 8.2 crore. PBIDT rose 36.02% to Rs 170.3 crore. Provision for interest rose 41.67% to Rs 3.4 crore.

PBDT rose 35.91% to Rs 166.9 crore. Profit before tax grew 42.61% to Rs 147.60 crore. Share of profit/loss were nil in both the periods. Provision for tax was expense of Rs 37.7 crore, compared to Rs 26.6 crore. Effective tax rate was 25.54% compared to 25.70%.

Minority interest was nil in both the periods. Net profit attributable to owners of the company increased 42.91% to Rs 109.90 crore.

Promoters’ stake was 74.76% as of 30 June 2023 ,compared to 74.76% as of 30 June 2022.

Sharing an overview on the quarter’s performance, Rajiv Rajgopal, Managing Director, Akzo Nobel India said, “Building on our profitable growth momentum, we delivered a record performance across absolute Revenue, EBIT and PAT in the first quarter of FY24. Demand uptick seen across infrastructure, automotive, marine and oil and gas sectors aided Coatings, conducive real estate drove projects, while semi-urban, rural geographies supported retail growth during the quarter.

Sequential softening in raw material costs and gains of earlier pricing actions translated to an improvement in gross margins. Favourable operating leverage drove continued double-digit profitability. Operating profit after tax crossed Rs 100 crore mark per quarter for the first time.”

Full year results analysis.

Net sales (including other operating income) of Akzo Nobel India has increased 20.76% to Rs 3802.1 crore. Operating profit margin has jumped from 13.74% to 13.81%, leading to 21.41% rise in operating profit to Rs 525.10 crore. Raw material cost as a % of total sales (net of stock adjustments) increased from 54.79% to 54.84%. Purchase of finished goods cost fell from 5.99% to 5.31%. Employee cost decreased from 8.15% to 7.93%. Other expenses rose from 17.71% to 18.07%.

Other income rose 20.70% to Rs 27.4 crore. PBIDT rose 21.38% to Rs 552.5 crore. Provision for interest fell 2.76% to Rs 14.1 crore. Loan funds declined from Rs 70.50 crore as of 31 March 2022 to Rs 69.70 crore as of 31 March 2023. Inventories declined from Rs 664.40 crore as of 31 March 2022 to Rs 597.90 crore as of 31 March 2023. Sundry debtors were higher at Rs 552.30 crore as of 31 March 2023 compared to Rs 495.50 crore as of 31 March 2022. Cash and bank balance rose to Rs 564.30 crore as of 31 March 2023 from Rs 458.50 crore as of 31 March 2022.

PBDT rose 22.17% to Rs 538.4 crore. Provision for depreciation rose 8.70% to Rs 82.5 crore. Fixed assets increased to Rs 579.50 crore as of 31 March 2023 from Rs 556.60 crore as of 31 March 2022. Intangible assets declined from Rs 5.20 crore to Rs 4.10 crore.

Profit before tax grew 24.97% to Rs 455.90 crore. Share of profit/loss were nil in both the periods. Provision for tax was expense of Rs 120.8 crore, compared to Rs 76.7 crore. Effective tax rate was 26.50% compared to 20.91%.

Minority interest was nil in both the periods. Net profit attributable to owners of the company increased 15.51% to Rs 335.10 crore.

Equity capital stood at Rs 45.50 crore as of 31 March 2023 to Rs 45.50 crore as of 31 March 2022. Per share face Value remained same at Rs 10.00.

Promoters’ stake was 74.76% as of 31 March 2023 ,compared to 74.76% as of 31 March 2022 .

Cash flow from operating activities increased to Rs 486.20 crore for year ended March 2023 from Rs 121.40 crore for year ended March 2022. Cash flow used in acquiring fixed assets during the year ended March 2023 stood at Rs 104.30 crore, compared to Rs 63.40 crore during the year ended March 2022. .

The scrip trades at Rs 2901

Akzo Nobel India : Consolidated Results
Particulars	2306 (03)	2206 (03)	Var.(%)	2303 (12)	2203 (12)	Var.(%)
Net Sales	999.20	937.7	7	3,802.10	3,148.60	21
OPM (%)	16.2	12.9		13.8	13.7
OP	162.10	121.1	34	525.1	432.5	21
Other Inc.	8.20	4.1	100	27.4	22.7	21
PBIDT	170.30	125.2	36	552.50	455.2	21
Interest	3.40	2.4	42	14.1	14.5	-3
PBDT	166.90	122.8	36	538.40	440.7	22
Depreciation	19.30	19.3	0	82.5	75.9	9
PBT	147.60	103.5	43	455.90	364.8	25
Share of Profit/(Loss) from Associates	0.00	0		0	0
PBT before EO	147.60	103.5	43	455.90	364.8	25
EO Income	0.00	0		0	2
PBT after EO	147.60	103.5	43	455.90	366.8	24
Taxation	37.70	26.6	42	120.8	76.7	57
PAT	109.90	76.9	43	335.10	290.1	16
Minority Interest (MI)	0.00	0		0	0
Net profit	109.90	76.9	43	335.10	290.1	16
EPS (Rs)*	#	#		73.6	63.4
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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