Asian Paints Q3 profit seen up 16%, volume growth may be 12%

Asian Paints, one of the largest paint manufacturers, is expected to report 16.5 percent year-on-year growth in consolidated profit at Rs 570 crore and 16.6 percent growth in revenue from operations (ex-excise) at Rs 4,589 crore compared to year-ago.

According to average of estimates of analysts polled by CNBC-TV18, operating profit is seen rising 14.6 percent year-on-year to Rs 889 crore but margin may contract 30 basis points to 19.4 percent in Q3.

The stock has underperformed Kansai over the last few months. In last one year, Asian Paints rallied 23 percent while Kansai Nerolac surged 68 percent.

Volume growth, which is expected to be around 11-12 percent for the quarter, is the most important to watch out. Also watch out for margins, commentary on demand and input costs.

Crude oil prices increased 23 percent YoY and 19 percent QoQ in Q3FY18, which may have an impact on margins.

Asian Paints has taken around 5-6 percent price hike since March 1, 2017.