Rising costs to hurt Kansai Nerolac FY11 margins

Rising costs to hurt Kansai Nerolac FY11 margins

Mumbai: Rising inputs costs are likely to drag down profit margins for India’s no. 2 paintmaker Kansai Nerolac Paints in FY11 to FY09 levels, after a stronger-than-expected rise last year, a top executive said on Tuesday.

“I don’t think we will be able to maintain it at 14%, as you see inflation has been high," Prashant Pai, vice-president finance, told Reuters in a telephone interview.

“Last quarter the PBT (profit before tax) was around 11.5%... one can look around at that range, if the prices are stable."

The executive said he expects the Indian paints industry to grow about 14-15% in FY11, mainly driven by strong demand from automobile sector.

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