Asian Paints proved colourful in early trades on Thursday as net profit for third-quarter jumped 27%, beyond expectations of the market.
The scrip of the largest Indian paints company edged up 1.25% to Rs 333 by 10:11 IST. Volumes on the counter on BSE, though, were frugal at 150 shares. At the same time, the BSE Sensex was barely higher at 3,359.35, up 1.66 points.
On Wednesday after market hours, Asian Paints said Q3 ended December 2002 net profit rose 27% to Rs 43.66 crore compared to Rs 34.34 crore in the corresponding period of the previous year. Net sales increased 10.33% to Rs 413.36 crore from Rs 374.67 crore in December quarter 2001.
Both net profit as well as net sales outdistanced analysts' expectations. A capitalmarket.com poll of three FMCG analysts projected net profit growth at 13.6-19% to Rs 39-40.88 crore and net sales at Rs 397.20-404.64 crore (Rs 3.97-4.04 billion).
Last month, the company announced that it was transforming itself into a global major in the decorative paints business, with particular focus on emerging markets, following its acquisition of controlling stakes in Berger International of Singapore and SCIB Chemical SAE of Egypt. The total investment made by the company in both these acquisitions amounted to around $16.80 million.
Asian Paints said that it would focus on emerging markets of the world for growth, and also that Berger International will be the main growth driver for its international operations.
Further, the company said it would implement cost structures in Berger's operations worldwide for increase in plant efficiencies and asset productivity. It would focus on improving working capital management through various initiatives and introduce information technology in areas of operations, where essential.
Singapore-based BIL manufactures and markets paints in 11 countries covering China, South East Asia, the Middle East and the Carribean Islands. BIL has no operations in India.
APL is India's largest manufacturer of paints. With a 44% market share in the domestic paints markets, the company has now set its eyes on overseas markets. APL ranks among the top 15 decorative coatings companies in the world.
As on 30 September 2002, promoters held 42.59% stake in APL, while the public, institutions and foreign bodies held 20.16%, 15.41% and 20.84% in the company, respectively.
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