Akzo Nobel Q4 Review — In Better Position To Maintain Margins Compared To Its Peers, Says ICICI Securities

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ICICI Securities Report

While paint industry contracted in FY25 and Birla Opus also grabbed a low-mid single share in FY25, Akzo Nobel India Ltd. performed well with market share gains in all four quarters of FY25. Akzo has done healthy investments in product differentiation and distribution but we believe the chief reason for market share gain is premium/ luxury positioning.

In our view, the price conscious consumers are likely to be swayed away by new brands offering higher trade discounts/schemes. However, Akzo’s core consumers of premium paints (>Rs 250/litre) are likely to stay in the segment.

The existing B2B consumers are also likely to stay with Akzo as they have preferred superior quality. With stability in revenues and market shares, we believe Akzo is in a better position to maintain its margins compared to its peers.

Akzo gained market shares even in Q4 FY25 when Birla Opus has likely hurt all other economy and mass brands. Maintain Add.

We reckon, [comfortable] competitive equilibrium in paints is likely broken. Retain underweight on large cap paints. Contrarian investors may consider owning Akzo Nobel/Indigo Paints/Kansai Nerolac.

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