Berger Paints Q4 FY26 profit jumps 28%, shares up 9%

Stock jumps to a three-month high

Berger Paints India shares rallied sharply on Wednesday after the company reported a strong rise in March-quarter profit, supported by easing input costs and a better product mix. The stock climbed 9.27% to ₹533.35 on the NSE, marking a three-month high during the session. Buying interest spread across the sector, with Asian Paints, Kansai Nerolac and other paint makers gaining up to about 5%.

The move came as investors digested a quarter where volume growth was strong and margins improved, while management commentary stayed constructive but flagged near-term risks from forex and geopolitics.

Q4 FY26: Profit rises on mix improvement and softer raw material costs

For Q4 FY26 (quarter ended March 31, 2026), Berger Paints reported consolidated net profit of ₹335.25 crore, up 27.52% year-on-year, compared with ₹262.91 crore in Q4 FY25. Revenue from operations increased 6.06% to ₹2,868.03 crore, from ₹2,704.03 crore a year earlier.

Management attributed the improvement to qualitative enrichment in mix and lower raw material prices. The company also indicated that demand improvement seen in the prior quarter continued into Q4.

Volume growth stands out in Q4

Managing Director and CEO Abhijit Roy said Berger Paints achieved volume growth of 11.8% in the March quarter, supported by improving demand and channel actions ahead of price hikes. HSIE also flagged that growth was driven by strong double-digit volume growth in the decorative segment, led by premium emulsions and channel stocking ahead of price increases.

The company’s commentary pointed to demand improvement across segments and markets, with a sequential monthly uptick through the quarter.

Margins and cost line: Gross margin at a three-year high

Berger Paints reported higher profitability metrics in Q4 FY26, helped by costs and mix. EBITDA (excluding other income) rose 12.6% year-on-year to ₹481.7 crore (from ₹427.8 crore). EBITDA margin improved to 16.8% from 15.8%.

Gross margin for the quarter was reported at 42.3%, the highest level in the last three financial years. The company said the improvement came from favourable mix enrichment, lower impact from price cuts in the economy segment, and partial benefits from the withdrawal of anti-dumping duty on titanium dioxide.

On the cost side, total expenses rose 4.11% year-on-year to ₹2,499 crore. Cost of materials consumed declined 7.70% to ₹1,500.51 crore, while employee benefit expenses increased 10.35% to ₹222.39 crore. Finance costs fell 23.17% to ₹11.60 crore.

Segment update: Decorative, auto and industrial commentary

Roy said the automotive segment performed strongly due to higher demand following GST cuts and lower financing costs, while the general industrial segment also reported good growth. Protective and powder coatings recorded month-on-month improvement, indicating recovery towards the end of the quarter.

The company also highlighted continued traction in focus categories such as waterproofing, construction chemicals and wood coatings, and cited a positive response to a new premium emulsion launch, Kolor Plus.

FY26 snapshot: Profit down, revenue up modestly

For the full year FY26, Berger Paints reported consolidated net profit of ₹1,128.8 crore, down 4.6% from the previous year. Revenue from operations rose 2.9% to ₹11,880.3 crore, while EBITDA declined 1.2% to ₹1,833.3 crore.

The company said annual profitability was impacted by the implementation of newly notified labour codes and a one-time loss linked to a warehouse fire in Barasat, West Bengal.

Outlook: Price hikes support margins, risks remain

On the outlook, Roy said gradual improvement in domestic demand indicators and sequential monthly demand uptick were positive signs for the coming months. He added that calibrated price increases of over 11%, initiated in a staggered manner from end-March 2026, are expected to support gross margins amid rising raw material costs.

At the same time, the company flagged near-term margin risks from forex volatility and geopolitical uncertainty, citing possible supply disruptions and raw material inflation.

Dividend and board decision

Alongside results, the company’s board recommended a dividend of ₹4 per equity share (face value ₹1 each) for FY26, subject to shareholder approval at the 102nd annual general meeting.

The board also approved the reappointment of Abhijit Roy as Managing Director and CEO for a further term of four years from 1 July 2027 to 30 June 2031.

Brokerages lift targets after earnings

Brokerages broadly stayed positive after the earnings announcement and management commentary. Nomura retained a ‘buy’ rating and raised its target price to ₹650 from ₹625, citing expected support from double-digit price hikes, continued volume growth, stable competition and improvement in subsidiaries.

Nuvama Wealth Management retained ‘buy’ and increased its target to ₹635 from ₹605, expecting value growth in FY27 to outpace volume growth. Asit C. Mehta Investment Intermediaries retained ‘buy’ with a target of ₹610, while Systematix maintained ‘buy’ with a target of ₹570.

ICICI Securities reiterated an ‘Add’ call and revised its target to ₹550 from ₹530, highlighting urban distribution investments including 1,900 exclusive stores and a 26% expansion in tinting machines during FY26. Equirus maintained a ‘Long’ rating with a June 2027 target of ₹577.

Key numbers at a glance

Brokerage targets and calls

Why the result mattered for paint stocks

The Q4 outcome mattered for the broader paint pack because it combined strong volume growth with margin improvement, even as raw material and macro uncertainties remained on the table. Brokerages also pointed to moderated competitive intensity, noting that pricing actions by peers and new entrants have changed near-term pricing dynamics.

For investors, the key monitorables from here remain the extent to which the recent 11-12% price hikes hold, how raw material inflation plays out, and whether volume momentum sustains across decorative and industrial categories.

Conclusion

Berger Paints’ Q4 FY26 print delivered a clear positive surprise on profitability, with profit up nearly 28% and margins improving to multi-year highs, triggering a sharp stock move and supportive brokerage actions. Management expects staggered price hikes to support gross margin, while continuing to track risks from forex volatility and geopolitical disruptions. The next key checkpoints will be the follow-through of price increases through FY27 and how demand trends evolve across decorative and industrial segments.