India’s second-largest paint manufacturer recently announced a stock split and its result for the April to June quarter (Q1FY24) of the financial year 2023-24. Its shares settled at ₹ 693.00 apiece on Thursday’s closing bell.
According to an exchange filing, Berger Industries’ consolidated profit after tax came in at ₹ 354.91 in Q1FY24, up 39.89 percent compared to ₹ 253.71 crores in the corresponding quarter of the previous financial year (Q1FY23). Its revenue climbed 9.78 percent to ₹ 3029.51 crores as compared to ₹ 2759.70 crores in the corresponding quarter of the previous year.
Berger paints reported a sharp expansion in its gross margin at 39.8 percent in the reporting quarter, up 4.1 percent as against 35.7 percent in Q1FY23.
In another development, the company’s board, at its meeting held on August 09, 2023, considered and approved the issue of one bonus equity share of the face value of ₹ 1 each against five equity shares of the face value of ₹ 1 each, i.e., in the ratio of 1:5.
The bonus is subject to the approval of shareholders. If approved, these shares will be credited to the respective demat account of the shareholders on or before October 7, 2023, subject to completion of the rest of the formalities and approvals as and when required.
Berger Paints India is engaged in the manufacturing and selling of paints, varnishes and enamels. It is one of the top paint companies in India along with Asian Paints, Kansai Nerolac Paints, Indigo Paints and the like.
With a market capitalization of ₹ 67,864 crores, Berger Paints is a large-cap company. It has an ideal return on equity of 20.41 percent and an ideal debt-to-equity ratio of 0.26. Its shares were trading at a price-to-earnings ratio (P/E) of 70.66, which is higher than the industry P/E of 15.93, indicating that the stock might be overvalued as compared to its peers.
The company’s promoters hold a 74.99 percent stake in it, followed by foreign institutions with 10.83 percent, retail investors with 10.71 percent, domestic institutions with 2.44 percent and mutual funds with 1.03 percent.
Written by Simran Bafna
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