INDIGOPNTS - Indigo Paints Limited Share Price

Q&A Section from Indigo Paints Q2 FY '26 Earnings Call

Question 1: "We were expecting double-digit volume growth to come back, but that has not been up to expectations. How do we build the case for the next few quarters? Is double-digit growth now certain?"

Answer: "Our growth is not on a weak base; last year, we outperformed the industry. Factors like unprecedented rainfall affected our performance. However, we see encouraging signals"”strong dealer inflows and increased scanning of painter tokens. While it's uncertain when demand will fully return, we expect to see double-digit growth in the coming quarters, possibly in Q4, as seasonal factors stabilize."

Question 2: "From the INR1,300-odd crores in sales, what is the optimum sales possible in the next few years based on this capacity expansion?"

Answer: "We can technically double our turnover with current capacity expansions. However, new plants do not immediately translate into sales"”it takes time. We do not foresee significant capex beyond this growth phase until FY '29."

Question 3: "What's your perspective on gross margin improvements compared to two quarters ago?"

Answer: "While there is competition-driven trade discounting, we've focused on premium products, leading to a recent gross margin improvement of 100 bps. Our margins reflect strong brand loyalty and better product mix, not solely external competition."

Question 4: "Regarding the Bihar market, with political climate factors, do you expect the state to grow faster than overall recovery?"

Answer: "Bihar has been one of our strongest markets recently, with high double-digit growth. The political climate may affect logistics temporarily, but we don't anticipate drastic impacts on demand. We expect steady growth in this region."

Question 5: "What innovative steps are being considered to speed up the painting process given consumer convenience factors?"

Answer: "While tools like sprays and modern implementations are adopted, the core issue is the nature of painting, which requires detailed prep and product knowledge. We continue to educate contractors on efficiency, aiming for more rapid but quality-driven services."

Question 6: "Can you quantify the recent growth in scanning and collections you've mentioned?"

Answer: "In September, we noted growth in scanning at about 30-40%, with distinct users scanning tokens rising by 18%. This signals a robust secondary sales period, which we anticipate will reflect positively in primary sales moving forward."

Question 7: "Share details about the vision for Apple Chemie now that it has performed well since acquisition?"

Answer: "Apple Chemie is expanding beyond Maharashtra into diverse regions for B2B selling. We aim for it to reach INR200 - 300 crores in the next three years, focusing on profitable growth. We're also working on developing an export market to boost revenues."