Berger Paints may hike prices again if titanium dioxide duty is imposed

Berger Paints may resort to another round of price hikes if the government imposes an additional duty on titanium dioxide to curb Chinese imports, Abhijit Roy, managing director and CEO of Berger Paints, said, even as the company sees paint consumption holding up despite recent price increases and expects double digit growth in the second quarter of FY27.

“There is a talk that the government is looking at imposing additional duty on titanium dioxide to prevent dumping from China primarily. If that happens, then it will raise the prices of most of the white paint, which is where most of titanium dioxide is used,” Roy told Fortune India. “In that case, we may have to resort to another price increase.”

The possible increase comes after Berger raised prices several times between the end of March and June as raw material costs rose following the West Asia crisis. Despite concerns that higher prices could weigh on consumption, Roy said demand has so far remained resilient.

Festive season offers a longer runway

Berger expects the second quarter to deliver double digit growth, following a strong first quarter in which sales and operating profit grew in double digits and profit after tax rose 29%. June was good for the company, Roy said, while July was also fairly good and August is looking positive so far.

“The demand is holding on and therefore, we expect that quarter two should be also double-digit growth for sure,” he said.

The company is particularly positive about the festive season. Diwali will fall on November this year, giving Berger a full September and October painting window. That is a significant improvement over last year, when prolonged rains from mid-May to October disrupted exterior painting and shortened the period before Diwali.

“This year should be good,” Roy said, pointing to less prolonged and less intense rainfall. The company expects the extended painting season to support consumption through the festive period.

The other tailwind is pricing. Roy said that if underlying volumes grow by 7% to 8%, Berger could still see value growth of around 13% to 14% because of the price increases already taken. Higher value growth could also support operating profit, provided volumes remain intact.

The company, however, needs demand to hold for this benefit to translate into sustained margin expansion. Roy said rising raw material costs initially put pressure on gross margins because price increases take time to pass through. In decorative paints, the pass through is relatively quicker, while industrial paints involve negotiations with customers.

“If the volume growth happens, only then it will hold true,” Roy said, referring to the margin benefit from higher value growth. “As of now, fortunately, the demand is holding up and therefore we expect that we should be able to have a decent margin expansion.”

The outlook marks a shift from FY26, which was relatively a tough year for the paint industry. An extended monsoon disrupted not only exterior painting but also led consumers to postpone interior work. The early Diwali last year further shortened the traditional festive painting window, leaving dealers with inventory that took longer to liquidate. Berger still managed volume growth of around 7% to 9%, but lower realisations muted value growth.

For FY27, Roy's view is more optimistic. “Overall, quarter one was good, quarter two should be slightly better. So the year looks good,” he said.

In Q1 FY27, Berger Paints reported consolidated revenue from operations of ₹3,583.8 crore, up 12% year on year, while operating profit rose around 15%. Consolidated PBT increased 18.1% to ₹542.6 crore, and profit after tax jumped 28.6% to ₹405 crore, compared with ₹315 crore a year earlier. Decorative paints and automotive coatings were key growth drivers, with overall volume growth at 8.4%.