India’s largest paints manufacturer, Asian Paints, released its Q4 FY25 results today, revealing a sharp 45% year-on-year drop in net profit to ₹692 crore. The company’s financial performance fell short of market expectations, significantly below the ₹1,069 crore forecast by a Moneycontrol poll of brokerages.
Exceptional Losses Drag Down Bottom Line
The steep decline in profit was largely attributed to exceptional items worth ₹182.96 crore in its consolidated financials. These included:
A ₹83.7 crore loss on the divestment of its Indonesian subsidiaries
An impairment loss of ₹77.8 crore related to goodwill from the acquisition of Obgenix Software (White Teak)
A further ₹21.5 crore impairment on intangibles associated with the Sri Lanka-based Causeway Paints
These one-time losses significantly impacted Asian Paints’ Q4 net profit, overshadowing its operational performance.
Revenue and Volume Growth Under Pressure
Consolidated revenue for Q4 FY25 fell 4.3% YoY to ₹8,359 crore, missing Street estimates of ₹8,619 crore. The decorative paints segment saw muted growth, with volume rising just 1.8% and revenue declining by 5.2% during the January to March quarter.
Asian Paints attributed the weak performance to muted demand, cautious consumer sentiment, downtrading, and intensified market competition.
“The weak demand conditions prevalent for the past few quarters continued to affect the paint industry even in the last quarter of the financial year,” said Amit Syngle, Managing Director & CEO.
Standalone Performance Also Disappoints
On a standalone basis, the company reported a 5.1% drop in revenue to ₹7,192.4 crore, while net profit plunged 42.6% to ₹694.3 crore. This includes:
An impairment loss of ₹101.3 crore on investments in White Teak
A ₹78.51 crore loss from fair valuation of derivative contracts linked to a planned 40% stake acquisition in White Teak
International Business Faces Global Headwinds
Asian Paints’ international operations reported a value decline of 1.5%, largely due to currency devaluation in markets like Ethiopia and Egypt and macroeconomic challenges in Bangladesh. However, when adjusted for currency fluctuations, the international portfolio delivered 6% revenue growth during the quarter.
Dividend Announcement Despite Weak Results
Despite the subdued performance, the board of Asian Paints declared a final dividend of ₹20.55 per equity share, bringing the total dividend for FY25 to ₹24.8 per share.
Record Date: 10 June 2025
Payout Date (subject to approval): 30 June 2025
Stock Reaction Post-Results
Following the earnings announcement, Asian Paints’ share price dropped 1%, closing at ₹2,310.7 on the NSE.
Conclusion
Asian Paints Q4 FY25 results reflect the challenges faced by the paints industry amid weak demand and one-time financial setbacks. With declining profits, sluggish revenue, and pressures from international markets, the quarter marked a difficult close to the fiscal year. However, the company’s dividend payout signals confidence in its long-term fundamentals, despite current headwinds.
