Paint maker Akzo Nobel India, opens new tab reported a flat fourth-quarter profit on Wednesday, due to weak demand and rising costs.

The “Dulux” paint maker’s consolidated net profit fell 0.3% to 1.08 billion rupees ($12.6 million) in the quarter ended March 31.

The firm, a unit of the Netherlands’ Akzo Nobel, opens new tab, said its revenue from operations rose 5% to 10.22 billion rupees.

A 5.2% surge in raw material costs pushed its total expenses up by 6% to 8.87 billion rupees.

Key context

Indian paint makers face sluggish retail demand as consumers opt for cheaper alternatives amid heightened competition triggered by Grasim Industries’, opens new tab entry.

Analysts had predicted that higher operating and marketing costs would limit margin growth in the fourth quarter.

However, analysts at Anand Rathi had hoped that the reported quarter would reflect the benefit of the 2%-3% price hike toward the end of the second quarter.

Market leader Asian Paints, opens new tab missed profit estimates and warned of the worst demand in decades, with little hope for near-term recovery.

Kansai Nerolac, opens new tab posted an unexpected decline in fourth-quarter profit as higher expenses overshadowed “better-than-the-market” automotive demand.

Berger Paints, opens new tab beat quarterly earnings estimates earlier in the day, with strong industrial demand cushioning retail weakness. Grasim Industries will report their results next week.