AkzoNobel India reported a 3% volume growth across decorative and industrial coatings in Q2 FY’26, despite weather-related disruptions. Premium decorative paints saw mid-single-digit growth, while automotive and specialty coatings also grew. The company is adjusting pricing to regain market share and focusing on enhanced execution and brand power. They expect improved demand and are preparing for the JSW Group integration.
Q2 FY’26 Performance Overview
AkzoNobel India’s earnings call highlighted a 3% volume growth in the second quarter of fiscal year 2026, combining both Decorative and Industrial coatings sectors. The company saw positive momentum, especially in its premium product segments. Revenue, however, saw a marginal decline of 1.5% due to challenges in the mass market segment and strategic pricing adjustments.
Segment Performance
Decorative Paints experienced marginal growth, with premium products showing stronger performance. Volume growth in premium Decorative Paints was near mid-single digits. Industrial Coatings demonstrated robust volume and revenue growth. Marine and Protective Coatings faced challenges due to a high base from the previous year’s large orders. Automotive and Specialty Coatings also experienced some challenges.
Strategic Initiatives
The company has initiated a strategic price correction, effective September 2025, aiming to enhance competitiveness and regain market share. This decision aligns with the impending integration with the JSW Group. AkzoNobel is focusing on improving execution, particularly in key markets, and enhancing brand activation to drive future growth. Digitization efforts are underway to improve productivity across various business functions.
Financial Position
Gross margins stood at 41.3%, impacted by product mix and raw material inflation in the Coatings business. EBIT percentage remained stable at 11.1%, supported by disciplined cost management. The company reported significant improvements in working capital management, resulting in cash generation of around INR 277 crores.
Outlook and Future Plans
AkzoNobel anticipates improved demand in the coming months and expects volume growth to steady, progressing from single to double digits. Repainting cycles are expected to drive growth from the fourth quarter of the fiscal year into the next. Integration with the JSW Group is expected to provide new opportunities and strategic direction for the company. The EBITDA margin target remains between 14% and 16%.
Business Reorganization
The sale of the Power Coatings business and International Research Center to AkzoNobel NV was completed on July 1, 2025. Consequently, the Q2 FY’26 results do not include these segments. Prior-year numbers have been restated for comparison.
Source: BSE
