Berger Paints expects volume growth to hold as price hikes offset inflation
Proactive pricing and cost control keep margins in guided band despite input inflation
What management said
- Volume growth 11.8% in Q4; pre-buying impact limited to 3-4%
- Price hikes of 11-12% to fully offset raw material inflation, maintaining margins
- Competitive intensity stabilizing as new entrant raises prices and cuts painter schemes
The brief
Berger Paints reported Q4 standalone volume growth of 11.8% and value growth of 6.7%. Gross margin hit a 12-quarter high of 42.3%, and operating margin reached an 10-quarter high of 18.3%, driven by favourable mix and cost optimisation. PAT before exceptional items rose 23%; after exceptional items (insurance claim reversal) it grew 38%. Management expects FY27 volume growth to remain decent despite the 11-12% price hikes taken to offset raw material inflation, with value growth likely exceeding volume. Operating margins are guided to stay within the 15-17% range. Competitive intensity is stabilising as the new entrant raises dealer prices and reduces painter incentives. West Bengal's new government is expected to boost growth. Management reiterated that price increases have fully neutralised raw material cost inflation, with further savings from formulation and sourcing efficiency. The verdict: Proactive pricing and cost controls position Berger well, but demand elasticity and global volatility remain key monitorables.
In their words
“We have taken up price increases of 12% and there are savings elsewhere ... we will be able to maintain our gross margin.”— Abhijit Roy — Managing Director & CEO
“More or less, our track record has shown that we typically remain in that 15 to 17% operating margin range.”— Abhijit Roy — Managing Director & CEO
“Birla Opus has actually increased more than what the industry has done ... behaving as a responsible player.”— Abhijit Roy — Managing Director & CEO
Summarised from the Berger Paints India Ltd Q4 2026 earnings-call transcript. View transcript.