Berger Paints lifts margin as profit grows 29% year on year
Revenue grew faster than expenses, while other income contributed 9.34% of pre-tax profit and supported the earnings increase.
Filed 05 Aug 2026, 15:06 IST · Berger Paints India Ltd (BERGEPAINT)
Key takeaways
- Consolidated net profit rose 28.56% year on year, helped by a 0.12 percentage-point lower tax rate and sharply higher other income.
- Operating margin widened 0.44 percentage points year on year as revenue grew 11.97%, faster than expenses at 11.37%.
- Operating margin reached 16.95%, 3.57 percentage points above the 13.38% median for 86 Consumer Discretionary peers.
Price around the results
Revenue growth translated into wider operating margin
Berger Paints reported consolidated revenue growth of 11.97% year on year in Q1FY27, while expenses rose 11.37%; the faster revenue growth lifted operating margin by 0.44 percentage points. Operating profit consequently grew 14.96%, ahead of revenue. Management said decorative sales value grew approximately 13.5%, with nearly 20% operating-profit growth and margin expansion, while Construction Chemicals and Waterproofing also delivered volume and value growth.
Raw material inflation still restrained gross margin
Management said gross margin moderated year on year because of raw material inflation and delayed realization of recent price increases, particularly in the industrial category. The company also said BNPA margins were slightly lower because higher input costs were not yet fully offset by pricing. Despite these pressures, operating margin improved sequentially by 0.16 percentage points as revenue grew 24.96% and expenses grew 24.72%.
Margin recovery has continued for four quarters
Operating margin has risen from 12.46% in Q2FY26 to 15.78% in Q3FY26, 16.79% in Q4FY26 and 16.95% in Q1FY27. This is the fourth consecutive quarter of improvement from the Q2FY26 low, and the current margin is above the 13.38% median reported by 86 Consumer Discretionary peers. Management said operating margins are expected to remain within the guided range in FY27.
Other income made a meaningful contribution to profit
Other income rose to Rs 50.67 cr from Rs 2.82 cr a year earlier and accounted for 9.34% of pre-tax profit, so the 28.56% year-on-year increase in net profit was not purely operational. Lower interest expense, down 13.95% year on year, also supported pre-tax profit, while the tax rate was nearly unchanged at a 0.12 percentage-point lower level. Management said the store network had expanded to more than 1,900 locations and tinting-machine installations exceeded 2,100 during the quarter.
Past results were followed by consistent gains
The stock has risen after all eight recent results, with a median absolute move of 2.29%. A current post-results market move is not assessed here. Management said it expects double-digit revenue growth to continue, supported by Q2 price increases, festive demand and distribution expansion, and said a progressing monsoon may support rural sentiment.
Q1FY27 at a glance
Consolidated figures as filed with NSE — filed ahead of third-party databases, not yet independently cross-checked.
| Line item | Q1FY27 | Q4FY26 | QoQ | YoY |
|---|---|---|---|---|
| Revenue | ₹3,584 cr | ₹2,868 cr | +24.96% | +11.97% |
| Other income | ₹51 cr | ₹69 cr | -27.05% | +1696.81% |
| Expenses | ₹2,976 cr | ₹2,386 cr | +24.72% | +11.37% |
| Operating profit | ₹607 cr | ₹482 cr | +26.11% | +14.96% |
| Operating margin (%) | 16.95% | 16.79% | — | — |
| Interest | ₹12 cr | ₹12 cr | +7.41% | -13.95% |
| Depreciation | ₹103 cr | ₹101 cr | +2.00% | +9.66% |
| Profit before tax | ₹543 cr | ₹438 cr | +23.74% | +28.34% |
| Tax | ₹138 cr | ₹103 cr | +33.26% | +27.71% |
| Net profit | ₹405 cr | ₹335 cr | +20.81% | +28.56% |
| EPS (₹) | ₹3.47 | ₹2.87 | +20.91% | +28.52% |
Operating margin of 16.95% compares with a Consumer Discretionary sector median of 13.38% across 86 peers that have reported Q1FY27.
What management said
From the company’s own investor presentation. Each point is checked against the source document before it appears here.
This quarter
- Decorative delivered approximately 13.5% value growth and nearly 20% operating profit growth with margin expansion.
- Construction Chemicals and Waterproofing delivered robust volume and value growth.
Guidance & outlook
- Double-digit revenue growth is expected to continue, supported by Q2 price increases, festive demand and distribution expansion.
- Operating margins are expected to remain within the guided range in FY27.
- A progressing monsoon may support rural sentiment.
- The company will closely monitor crude oil, currency and geopolitical developments.
Expansion
- The store footprint expanded to more than 1,900 stores, including around 900 urban stores.
- Tinting machine installations exceeded 2,100 during the quarter.
New initiatives
- The company plans sustained investments in brands, innovation and retail activation to strengthen its consumer base.
Competition
- Market competitiveness is expected to remain elevated.
Problems & risks
- Gross margin moderated year over year because of raw material inflation and delayed realization of price increases.
- Bolix reported flat revenue because of seasonal factors, while UK operations remained subdued.
- BNPA margins moderated slightly because higher input costs were not yet fully offset by price increases.
What to watch
- Whether operating margin holds above 16.95% as price increases catch up with raw material costs.
- Whether other income remains below or above its current 9.34% contribution to pre-tax profit.
- Whether revenue growth remains above the 11.97% year-on-year rate as Q2 price increases and festive demand enter the comparison.