Kansai Nerolac today reported a decline in consolidated net profit at Rs 48.9 crore for the third quarter ended December 31, 2012, despite a growth in sales.
The company had posted a net profit of Rs 52.7 crore in the corresponding period last fiscal.
Net sales for the quarter stood at Rs 766.6 crore, marking a growth of 15.2 per cent, as compared to Rs 665.7 crore over the same period of the previous year.
"Demand for the paint has improved over the preceding quarter due to the delayed Diwali season. We are, however, yet to see strong demand recovery. Certain segments of the industrial market continue to witness low and subdued demand. Inflationary pressures have continued during the quarter," company's managing director H M Bharuka said in a statement.
The industry is also yet to see recovery in the working capital cycle, he said.
The size of domestic paint industry stood at around Rs 26,000 crore as of March 2012.
"While there is a renewed thrust on reforms, the base effect as well as low demand for automotives makes the outlook for Q4 tough. Overall, however, the picture of paint demand remains very positive over the long term," Bharuka said.
