Asian Paints, probably the most expensive FMCG stock on the bourse has posted a solid performance for Q1FY15.  Consolidated net sales at Rs.3325 crore was up 18% (YoY) and this surge in topline was good enough to push through a higher net profit, despite a 18% jump in operating costs and an exceptional expense of Rs.25 crore due to the VRS scheme provided to the workers of its closed Bhandup unit, the company ended the quarter with a 23% rise in net profit at Rs.339 crore. The price hike has also helped – there were two hikes, one of 1% from 1sy May’14 and 1.2% from 1^st June’14.

Consolidated EBITDA came in at Rs.557 crore v/s Rs.465 crore (YoY) and the improvement in margins is what enthused the market – EBITDA margin rose from 15.7% to 16.6%. This resounding performance was delivered on the back of a double digit growth in the decorative paints business across all geographies. The Automotive coatings JV saw good growth in the General Industrial segment and Refinish segments while the Automotive segment demand was subdued. The Industrial Coatings JV, which had seen a decline in the previous year, saw good volume growth in the Industrial Liquid Paints and Road Marking business. Performance of the International units were a mixed bag with units in Caribbean, UAE, Singapore and Bangladesh doing well. Operations in Egypt were affected due to weak business sentiment in the country. Addition from Sleek and from Ess Ess Bathroom is expected to add well to the margins from this fiscal.