Broad strokes: Pricing power to help paint majors clock volume-led growth

Paint companies' relatively good performance in recent quarters, with double-digit volume growth and strong margins, is a key driving factor

A consistently strong performance has helped paint companies attract investor support for many months now, akin to fast-moving consumer goods (FMCG) players. While part of the investor demand can be attributed to stress in other key sectors, such as like automobile and non-banking financial companies, paint companies are still doing well.
 

As a result, the stocks of paint majors — Asian Paints and Berger Paints — have surged 21-54 per cent in the past six months; Kansai Nerolac Paints is up 15 per cent. The Nifty FMCG Index is up only 1.7 per cent during this period.
 

Paint companies’ relatively