💰 Financial Performance

Revenue Growth by Segment

The paint business, operated through Kamdhenu Colour and Coatings Limited, reported revenue of INR 266.1 Cr in FY25, representing an 8.8% YoY decline from INR 291.7 Cr in FY24. However, Q2 FY26 showed a recovery with revenue of INR 56.8 Cr, a 4% YoY increase from INR 54.8 Cr in Q2 FY25.

Geographic Revenue Split

The company maintains a pan-India reach through an asset-light franchise model. A new depot was specifically opened in New Delhi in November 2025 to strengthen the distribution network in the Northern region. Specific regional percentage splits are not disclosed.

Profitability Margins

Gross Profit Margin for FY25 stood at 44.1%, a slight compression from 45.2% in FY24. In Q2 FY26, the GP margin was 44.0%. Net Profit Ratio for FY25 declined significantly to 2.50% from 4.74% in the previous year due to lower overall profitability.

EBITDA Margin

EBITDA margin for FY25 was 6.3% (INR 16.8 Cr), down from 7.7% (INR 22.4 Cr) in FY24. For Q2 FY26, the EBITDA margin showed slight improvement to 6.5% (INR 3.7 Cr) compared to 6.3% (INR 3.5 Cr) in Q2 FY25.

Capital Expenditure

Capital Work in Progress (CWIP) was reported at INR 0.8 Cr as of September 2025, up from INR 0.1 Cr in March 2025. The company follows an asset-light model, prioritizing franchise partnerships over heavy manufacturing CAPEX.

Credit Rating & Borrowing

Total consolidated borrowings as of September 2025 stood at INR 28.0 Cr (comprising INR 4.1 Cr non-current and INR 23.9 Cr current borrowings). The Interest Coverage Ratio declined to 4.13 times in FY25 from 6.86 times in FY24 due to decreased profits.

⚙️ Operational Drivers

Raw Materials

Raw materials for paint manufacturing (including pigments, solvents, and resins) represent the largest cost component. In H1 FY26, total raw material costs were INR 58.1 Cr, accounting for approximately 54.3% of total revenue.

Capacity Expansion

The company utilizes an asset-light franchise model for manufacturing. While specific MTPA capacity is not listed, the strategy focuses on widening the presence and deepening the product range through third-party manufacturing and franchise tie-ups.

Raw Material Costs

Raw material costs for FY25 were INR 148.8 Cr, representing 55.9% of revenue. This was a decrease from INR 159.8 Cr in FY24, though margins compressed due to a sharper decline in top-line revenue.

Manufacturing Efficiency

The company focuses on an asset-light model to maintain stable margins. ROCE declined to 6.44% in FY25 from 10.41% in FY24, reflecting lower capital efficiency during the period.

Logistics & Distribution

The company emphasizes 'distribution speed' as a core advantage. Trade Receivable Turnover Ratio was 1.89 times in FY25, down 19.78% YoY, suggesting a lengthening of the cash conversion cycle.

📈 Strategic Growth

Expected Growth Rate

Not disclosed

Growth Strategy

Growth is targeted through an asset-light franchise model, strengthening brand trust, widening geographic presence (e.g., New Delhi depot), and deepening the product range to translate active demand into stable margins.

Products & Services

Decorative paints, coatings, and related chemical products for the housing and construction sectors.

Brand Portfolio

Kamdhenu Paints

New Products/Services

The company is focused on deepening its existing product range in the decorative paints segment; specific new product revenue contributions are not disclosed.

Market Expansion

Expansion is focused on a pan-India reach, recently evidenced by the opening of a new depot in New Delhi in November 2025 to better serve the NCR and Northern Indian markets.

Market Share & Ranking

Not disclosed.

Strategic Alliances

The company operates primarily through an asset-light franchise model, involving multiple franchise partners for manufacturing and distribution.

🌍 External Factors

Industry Trends

The paint industry is seeing increased competition from new large entrants. Success is increasingly driven by brand trust, product assurance, and distribution speed. The sector is also shifting toward tighter sustainability and environmental requirements.

Competitive Landscape

The industry is highly competitive, featuring established national players, regional brands, and aggressive new entrants from other industrial sectors.

Competitive Moat

The moat is built on an asset-light franchise model, which allows for scalable growth with lower capital intensity, combined with a 'retail-first' brand position and a legacy of trust from the Kamdhenu brand.

Macro Economic Sensitivity

Highly sensitive to domestic economic conditions and the housing/capex cycle, which supports demand for decorative paints.

Consumer Behavior

Evolving consumer preferences toward eco-friendly products and premium decorative finishes are driving product development.

Geopolitical Risks

Uncertainties in global supply chains can impact the availability and cost of imported chemical inputs for paint production.

⚖️ Regulatory & Governance

Industry Regulations

Operations are subject to environmental safety standards, emissions regulations, and sustainable practice norms typical of the chemical and coatings industry.

Environmental Compliance

The company must comply with evolving norms related to environmental safety and emissions; it invests in eco-friendly products to mitigate regulatory risks.

Taxation Policy Impact

The effective tax expense for FY25 was INR 2.54 Cr on a consolidated PBT of INR 9.20 Cr (approx. 27.6%).

⚠️ Risk Analysis

Key Uncertainties

Key risks include raw material price volatility (impacting margins by ~1-2%), demand fluctuations in the housing sector, and intense competition from new entrants.

Geographic Concentration Risk

While pan-India, the company is actively strengthening its footprint in North India, as seen with the New Delhi depot opening.

Third Party Dependencies

High dependency on franchise partners for manufacturing due to the asset-light business model.

Technology Obsolescence Risk

The company faces the need to continuously update product formulations to meet shifting environmental standards and consumer preferences for high-performance coatings.

Credit & Counterparty Risk

Trade receivables stood at INR 135.9 Cr as of September 2025; the Trade Receivable Turnover Ratio decline of 19.78% indicates a potential increase in credit risk or slower collections.