Kansai Nerolac Paints announced on Thursday that its board has approved the sale of a land parcel in Mumbai for Rs 726 crore, according to an exchange filing on the BSE.
The paint maker's board has okayed its proposal to enter into an agreement with Aethon Developers Pvt. for sale of the property that is located in Mumbai's Lower Parel area.
"With the completion of procedures and approvals as required for the sale, the company, today, has entered into definitive agreements for conveyance/assignment of lease with the purchaser," the filing said.
For the first quarter of the financial year 2024–25, the firm reported a 69.3% year-on-year decline in net profit, beating analysts' estimates. It was above the Rs 205.1 crore estimate by analysts data provided by Bloomberg.
The company, which is a subsidiary of Japan's Kansai Paint Co., had recorded a net profit of Rs 225 crore for the quarter-ended June, in comparison to Rs 734 crore in the same quarter last year, according to an exchange filing.
Revenue for the three months ended June had declined by 1.1% year-on-year to Rs 2,133 crore. Analysts tracked by Bloomberg had projected a revenue of Rs 2,195 crore.
Operating income, which represents Ebitda, had declined by 0.7% year-on-year to Rs 329 crore. The Ebitda margin remained unchanged at 15.4%. Analyst projections from Bloomberg for Ebitda and the Ebitda margin were Rs 296.1 crore and 13.5%, respectively.
Shares of Kansai Nerolac closed 1.45% lower at Rs 270.75 apiece on the NSE, compared to a 0.15% lower in the benchmark Nifty 50.
The stock has fallen 18.75% on a year-to-date basis and 15.11% over the past 12 months.
Out of the 19 analysts tracking the company, seven have a "buy" rating on the stock, four suggest a "hold" and eight recommend a "sell," according to the Bloomberg data.
The average of 12-month analysts' consensus price targets implies a potential upside of 18.7%.
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