Paint stocks trade higher; Shalimar Paints, Kansai Nerolac hit 52-week high
Shares of paint manufacturers were trading higher by up to 11% in an otherwise weak market after reporting strong earnings for the quarter ended June 30, 2016 (Q1FY17).
Berger Paints India, Asian Paints, Shalimar Paints and Kansai Nerolac were up between 1% and 11% on the BSE, as compared to 0.79% decline in the S&P BSE Sensex at 11:55 am.
Three paints companies – Asian Paints, Berger Paints India and Kansai Nerolac – so far announced their Q1FY17 results, have reported 26% year-on-year (YoY) growth in their aggregate net profit.
According to analyst at Prabhudas Lilladher expects the demand outlook for paint industry looks bright given normal monsoons, and expected impact of OROP and pay commission in 2HFY17.
Berger Paints India has moved higher by 2.5% at Rs 246 after the company reported 54.6% YoY jump in consolidated net profit at Rs 120 crore in Q1FY17. Income from operations grew 10.6% at Rs 1,246 crore on YoY basis.
Asian Paints was up 1% at Rs 1,135, extending its 5.7% gain in past four trading sessions. The company posted 19% YoY jump in its consolidated net profit at Rs 553 crore, on back of 10% YoY rise in net sales at Rs 4,035 crore in Q1FY17.
Kansai Nerolac Paints was up 4% at Rs 384 on the BSE in intra-day trade, surging 20% in past one-week after reported 33% YoY jump in net profit at Rs 127 crore in Q1FY17.
“The industrial and decorative paints segments to benefit from a boost in consumption due to the implementation of the Seventh Pay Commission, good and service tax (GST) and expectation of better monsoons," ICICI Securities said result update.
Shalimar Paints surged 11% to Rs 174, also its 52-week high on the BSE, ahead of its Q1 results on Friday, the August 12, 2016.