Pidilite Ind PAT up 61%, sales up 60%, but margin contracts 70 bps

10 Aug 2022

Pidilite Industries Ltd's consolidated net profit jumped 61% on year to 3.5 bln rupees in Apr-Jun on the back of a 60% rise in consolidated net sales to 31 bln rupees.

The operating profit, defined as earnings before interest, tax, depreciation and amortisation, of the company, was up sharply by 52% on year to 5.3 bln rupees.

But high operating costs during the quarter reined in the operating margin which contracted to 17.1% from 17.8% a year ago.

Sequentially, Pidilite's consolidated net profit rose 39% while net sales were up 24%. The operating profit was also up 32%.

The profitability of the company was hit due to a jump in raw material expenses. The cost of materials consumed, which made up for nearly 60% of total expenses, rose 72% on year to 15.7 bln rupees.

The cost of purchase of traded goods was also up substantially by 79% to 2.5 bln rupees.

Pidilite's managing director Bharat Puri said that the sales growth in volume and value terms was broad-based across business segments and geographies.

He said that due to rising input costs the company took calibrated pricing action.

"While the near term remains challenging, we remain cautiously optimistic on the medium term given the recent softening of input prices led by lower oil prices, a good monsoon and continued good demand conditions in the housing and home improvement sector," Puri said.