Low PE high ROE stock Akzo Nobel India sets record date for ₹25 dividend

The company has made public that its Board of Directors has recommended an interim dividend of ₹25/- per equity share for the financial year 2022-23. Akzo Nobel India said in a stock exchange filing that the Board has “Fixed Tuesday, 21 February, 2023 as the Record Date for determining entitlement of members to interim dividend for the financial year 2022-23. A member, whose name is recorded in the Register of Members or in the Register of Beneficial Owners maintained by the Depositories as on the close of business hours of Tuesday, 21 February, 2023, shall be entitled for this dividend.”

“The Board of Akzo Nobel India remains committed to creating value for its shareholders. Hence, based on the performance in the nine months ended 31 December 2022, the Board is delighted to announce an interim dividend of ₹25 per share for the year 2022-23,” said Mr. Oscar Wezenbeek, Chairman, Akzo Nobel India.

During Q3FY23, the company posted revenue from operations of ₹986.8 crore, up by 8% YoY from ₹914.40 Cr recorded in Q3FY22. Akzo Nobel India said its EBIT from operations reached ₹121.8 crore, up by 12%, whereas net expenses stood at ₹867.60 Cr in the quarter ended December 2022 compared to ₹808.70 Cr in the year-ago quarter, representing a fall of 1% YoY. The profit before tax of Akzo Nobel India stood at ₹131.60 Cr in Q3FY23 compared to ₹110.40 Cr in Q3FY22, whereas its net profit reached ₹97.4 crore in Q3FY23, up by 16% YoY from ₹83.90 Cr in Q3FY22.

Commenting on the performance, Rajiv Rajgopal, Managing Director, Akzo Nobel India said, “In the first nine months of the fiscal year, our robust 25% revenue growth has led to market share gains across businesses.” He added “We have registered a topline growth of 8% in the quarter led by a strong performance across the Coatings businesses. Decorative paints saw a relatively muted growth, retail markets were affected by monsoon in October but saw an uptick in November and December. Our double-digit profitability was driven by margin management and operating efficiencies.”

On Friday, the shares of Akzo Nobel India closed on the NSE at ₹2,180, down by 0.10% from the previous close of ₹2,182.15. The stock reached a 52-week-high of ₹2,400.00 on (18-Nov-2022) and a 52-week-low of ₹1,687.60 on (17-Jun-2022). Debt-free company Akzo Nobel India with a debt-to-equity ratio of zero posted a promoter shareholding of 74.76%, FIIs stake of 2.71%, DIIs stake of 9.21% and a public stake of 13.33% in Q3FY23. The price-to-earning ratio of Akzo Nobel India is 31.5, lower than its sector PE ratio of 62 whereas, Return on Equity(ROE) for FY22 was 23.1%, more than 20% in FY21, making the stock attractive despite being a debt-free and having zero promoter pledge, according to Trendlyne.