India’s second-largest decorative paints manufacturer reported a notable deceleration in profitability for the quarter ended 31 December 2025, reinforcing signals of uneven demand in the building materials sector as monsoon patterns and shifting consumption behaviours weigh on performance. Berger Paints India Ltd’s latest quarterly filings show stable revenue but a contraction in net profit, highlighting persistent market headwinds for paint makers closely tied to residential and commercial construction cycles.
For the third quarter of fiscal year 2025-26, the company’s consolidated net profit declined about 8 per cent year-on-year to approximately ₹271 crore, even as total revenue from operations edged up marginally to around ₹2,984 crore. Operating earnings before interest, tax, depreciation and amortisation (EBITDA) were broadly flat, reflecting tight cost management against a backdrop of subdued pricing power.Senior industry officials frame these outcomes within a context of atypical seasonal demand swings. Extended monsoon conditions into early October and a shorter festive season — traditionally a peak period for repainting and household renovations — suppressed discretionary spending on paints and coatings. Although volumes recovered through the latter part of the quarter, the disruption shifted a portion of consumption into later months, damping headline profitability.
Standalone performance metrics paint a similarly mixed picture: volume growth of around 8.5 per cent signalled resilience in product uptake, particularly in economy emulsions, textures and tile adhesives, yet value growth remained subdued. This divergence points to consumers increasingly prioritising cost-effective solutions amid persistent cost pressures on input materials, competitive pricing dynamics and shifting lifestyle spending patterns.For urban developers, retailers and builders, the performance underscores the nuanced demand landscape that has emerged in key Indian markets. Tier-I and tier-II cities have seen slowing repainting cycles as homeowners and property managers defer discretionary upgrades in the off-season, while rural markets — buoyed by infrastructure-led job creation — present uneven offsets. Urban planners suggest that such patterns may reflect deeper shifts in urban housing prioritisation, where essential maintenance competes with other household expenditures.
Strategic cost structures remain in focus, as the company also absorbed a one-time charge related to increased employee benefit obligations arising from new labour regulations. While this impacted short-term profitability, management emphasised gross margin improvements that reached multi-quarter highs, indicating some underlying operational efficiencies.Analysts note that the broader paints sector is operating under heightened competitive intensity, with new entrants and established players jostling for share through expanded distribution networks, product innovation and price promotions. In this environment, maintaining sustainable operating margins without eroding brand value will be critical for long-term growth.
Looking ahead, improvements in dry-season demand, infrastructure-linked housing activity and strategic portfolio diversification into waterproofing and construction chemicals are expected to shape the industry’s trajectory. However, translating volume gains into durable value growth will require sharper alignment between production, pricing strategies and evolving customer priorities.
