Paint stock falls after National Stock Exchange decides to remove it from F&O segment

The shares of the painting solution provider fell up to 2 percent after the National Stock Exchange decided to remove the company from the Futures & Options segment.

Price Movement

With a market capitalization of Rs 56,802.39 crore, the shares of Berger Paints India Ltd were trading at Rs 487.20 per share, decreasing around 1 percent as compared to the previous closing price of Rs 491.65 apiece.

Reason for fall

The shares of Berger Paints India Ltd have seen bearish movement after the National Stock Exchange decided to remove the company from the Futures & Options segment, effective from April 25. Existing unexpired contracts for the expiry months of February, March, and April 2025 will continue to be available for trading until their respective expiry dates. New strikes will also be introduced for the existing contract months.

Financial condition

Looking forward to the company’s financial performance, revenue climbed by 3.2 percent from Rs 2,882 crore in Q3FY24 to Rs 2,975 crore in Q3FY25 but during the same time, net profit down by 1.3 percent from Rs 300 crore to Rs 296 crore.

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Product Performance

The company’s decorative segment saw high single-digit volume growth, driven by waterproofing and construction chemicals. The exterior premium category expanded significantly, with 2,000+ new retail touchpoints and 1,800 color bank machines installed. Urban initiatives flourished, with exclusive stores enhancing customer experience before purchase.

Competition and Market Dynamics 

 A new competitor has captured a 3.5% market share, posing challenges for existing players. However, management remains confident, expecting to offset impacts through distribution expansion and urban initiatives, ensuring stable market share and restoring growth despite rising competitive pressures.

Margin Guidance & Future Outlook

 Operating margins are expected to stay within 15-17% despite competition and raw material price fluctuations. Improved consumer sentiment and favorable budget policies should drive decorative segment growth. Management remains optimistic about closing the volume-value gap as past price cuts diminish.

Company Profile

Berger Paints India Limited is an India-based company, which is engaged in the manufacturing and selling of paints. The Company offers products in categories, including interior wall coatings, exterior wall coatings, exterior textures, metal finishes, wood finishes, under coats, and waterproofing solutions.

Written by Abhishek Singh

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