INDIGOPNTS - Indigo Paints

📊 NSE: INDIGOPNTS 🏢 Paints / Varnishes 📅 Last Updated: 12/14/2025 8:00

💰 Financial Performance

Revenue Growth by Segment

Standalone revenue for Q2 FY26 grew 3.5% YoY to INR 298.5 Cr. Consolidated revenue for FY25 grew 2.65% to INR 1,340.7 Cr. Apple Chemie subsidiary achieved revenue of INR 63.7 Cr in FY25. Waterproofing and construction chemicals segment shows high single-digit contribution to top line.

Profitability Margins

Standalone Gross Margin for Q2 FY26 expanded to 45.1% from 44.1% YoY. Standalone PAT Margin for Q2 FY26 improved to 8.5% from 8.2% YoY. Consolidated PAT Margin for FY25 was 10.46%, down from 11.27% in FY24.

EBITDA Margin

Standalone EBITDA Margin for Q2 FY26 improved to 15.3% from 14.8% YoY, with absolute EBITDA at INR 45.8 Cr, up 7.5% YoY. Consolidated EBITDA margin for FY25 decreased to 17.42% from 18.23% in FY24.

Credit Rating & Borrowing

Interest coverage ratio stood at 65.95x in FY25 (standalone). Historical interest coverage was 16.51x in FY20. The company maintains a debt-equity ratio of 0 (debt-free).

⚙️ Operational Drivers

Raw Materials

Raw materials and components (specific names not disclosed) represent 53.48% of standalone revenue in FY25, up from 52.10% in FY24.

Raw Material Costs

Material costs stood at 53.48% of revenue in FY25. Muted demand led to higher trade discounts of 24.26% of revenue in FY25 compared to 21.78% in FY24, impacting gross margins.

Manufacturing Efficiency

EBITDA margins historically peak in Q4 due to an improved product mix and higher sales volume.

Logistics & Distribution

Freight and handling costs stood at 8.74% of revenue in FY25, down from 9.62% in FY24.

📈 Strategic Growth

Expected Growth Rate

3.50%

Growth Strategy

Growth is driven by the expansion of 'Indigo Color Canvas' experiential retail stores (8 added in Q2 FY26), increased focus on premium products, and BTL marketing to improve influencer engagement. The Apple Chemie acquisition (51% stake) facilitates entry into the high-growth construction chemicals and waterproofing market.

Products & Services

Decorative paints, waterproofing products, and construction chemicals.

Brand Portfolio

Indigo Paints, Indigo Color Canvas (experiential stores), Apple Chemie.

New Products/Services

Waterproofing and construction chemicals under the Indigo brand, inherited from Apple Chemie know-how, now contribute high single-digit percentages to the top line.

Market Expansion

Expansion of experiential retail centers and strategic concentration in specific geographic markets for the Apple Chemie subsidiary.

Market Share & Ranking

Maintains 'pole position' in the industry regarding gross margins (45.1% standalone in Q2 FY26 vs industry average of ~41.5%).

Strategic Alliances

Acquisition of a 51% holding in Apple Chemie to venture into construction chemicals.

🌍 External Factors

Industry Trends

The industry faced a de-growth/muted demand scenario in FY25, but market conditions are improving as of Q2 FY26 (3.5% growth). There is a shift toward premium products and digital outreach for influencers.

Competitive Landscape

Indigo continues to outperform the industry average gross margin by a wide margin (45.9% vs 41.5% in Q1 FY26).

Competitive Moat

Sustainable moat built on a basket of differentiated products and industry-leading gross margins (45.1% vs ~41.5% peers), supported by high A&P spending (6.4% of top line) compared to industry standards.

Macro Economic Sensitivity

Highly sensitive to weather conditions; extended monsoons in Q2 FY26 caused a significant sales slowdown in August before recovery in September.

Consumer Behavior

Shift toward experiential retail and influencer-led decision making, addressed by 'Color Canvas' stores and BTL marketing.

⚖️ Regulatory & Governance

Industry Regulations

Operations are subject to internal control systems for compliance with relevant laws and regulations, with internal audits reviewed by the Audit Committee.