Analyst Meet / AGM - Analyst Meet

16-May-2014, 04:33
Asian Paints held an analyst meet to discuss the performance for the quarter and year ended March 2014. Senior Management of the company addressed the call.

Highlights of the Concall

• Demand Conditions were resilient for decorative segment inspite of overall sluggish environment. The segment registered double digit volume growth led by Tier 2 & Tier 3 cities. Emulsions continue to do well

• Depreciation in currency impacted the material costs. Cumulative Price increase during FY 2013-14 is 6.25% (1st May'13: +1.2%; 1st Aug'13: +1%; 1st Sept'13: +1.8%; 1stFeb'14: +2.1%). The company took further price increase of 1% w.e.f. 1st May 2014 and shall took another 1.2% w.e.f. 1st June 2014

• Industrial coatings business continues to be affected by the economic slowdown. Automotive coatings growth was subdued due to poor demand in the automotive sector.

• Margins were better in Industrial segment compared to previous year due to lower inflation in material cost and better operational efficiencies

• International business performed well led by good growth in some key markets like Bangladesh, Nepal and Emirates. However, performance in some markets was impacted by continued political unrest and weak economic activity.

• In order to expand its international presence, Asian Paints had entered into an agreement with Kadisco Chemical Industry Plc, Ethiopia to acquire 51% of its share capital

• The company is focusing on expanding the kitchen business of Sleek through expansion of the network and working on synergies with the paints dealer network.

• Asian Paints has entered into a binding agreement with ESS ESS Bathroom Products and its promoters, to acquire its entire front end sales business including Brands, Network and Sales Infrastructure, subject to satisfaction of certain conditions precedents and applicable statutory approvals. ESS ESS Bathroom Products. is a prominent player in the bath & wash business segment in India and has high quality products in this segment

• The operations at the company's Paint Plant situated at Sriperumbudur, Tamil Nadu has resumed from 23rd April, 2014 as Asian Paints Employees' Union Sriperumbudur and workmen have ended the strike. This resulted in higher freight cost in last quarter to move material from other plants to the South

• The company launched Apcolite Advanced to bridge gap between Apcolite Premium Emulsion and Royale

• Ultra Luxury Royal Aspira launched across India

• The company has installed more than 3,200 Colour Worlds; total 27,000 Colour World dealers now

• The company launched 70 new Colour Ideas stores during the year

• The company sees signs of recovery in the Indian economy, chances of higher growth in FY'15

• Exports growth looking up with improvement in global growth prospects

• In International markets, concerns around political uncertainty especially in Egypt & Bangladesh; further currency depreciation risk in Jamaica & Egypt

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