Berger Paints (Pakistan) Limited (PSX: BERG) was incorporated in Pakistan as a private limited company in 1950 and was converted into a public limited company in 1974. The company is engaged in the manufacturing of paints, varnishes and other related products. A British Island based company; Slotrapid Limited is the holding company of BERG.
Pattern of Shareholding
As of June 30, 2026, BERG has a total of 24.552 million shares outstanding which are held by 2879 shareholders. Slotrapid Limited (the holding company) has the majority stake of 52.05 percent in BERG followed by local general public holding 38.24 percent shares of the company. Around 2.94 percent of the company’s shares are held by Directors, CEO, their spouse and minor children and 1.45 percent by NIT & ICP. The remaining shares are held by other categories of shareholders.
Historical Performance (2021-26)
BERG’s topline and bottomline which had been falling until 2020 rebounded in the subsequent years with 2021 touting the highest year-on-year topline growth. The margins follow an irregular trajectory over the years. The detailed performance review of the period under consideration is given below.
After two successive years of lackluster demand and topline contraction, BERG’s topline posted a staggering 34 percent year-on-year rise to clock in at Rs.5,602.16 million in 2021. Generous monetary measures, directed fiscal support, refinance schemes and housing schemes played an incredible role to put the economy back on track. While export sales continued to dwindle in 2021, local sales gained a lot of traction. Increase in the prices of raw materials, high freight and handling charges as well market induced rise in salaries and benefits culminated into 35.86 percent year-on-year growth in cost of sales. Gross profit grew by 27.41 percent year-on-year in 2021, however, GP margin inched down to 19.93 percent in 2021 from 20.98 percent in 2020. Operating expense ascended by 9.83 percent year-on-year in 2021. Other expense magnified by 496.44 percent year-on-year in 2021 on account of impairment of goodwill. However, it was counterbalanced by 8.97 percent year-on-year rise in other income due to exchange gain as well as sale of scrap. Operating profit mounted by 26.34 percent year-on-year in 2021, however, OP margin descended to 6.87 percent from 7.29 percent in 2020. Finance cost considerably dropped by 38 percent during 2021 due to monetary easing, resulting in 162.72 percent year-on-year growth in net profit. Profit after tax stood at Rs.195.22 million in 2021 with NP margin of 3.48 percent up from 1.78 percent in 2020. EPS also rebounded to Rs.9.54 in 2021 from 3.63 in 2020.
BERG’s topline grew by 26.83 percent year-on-year to clock in at Rs.7105.23 million in 2022. This was mainly on the back of an increase in sales volume. Record high inflation as well as Pak Rupee depreciation pushed up the cost of sales by 31.16 percent year-on-year in 2022. Gross profit grew by 9.42 percent year-on-year in 2022, however, GP margin bottomed out to 17.20 percent. Operating expense grew by 22.28 percent year-on-year in 2022 owing to inflation coupled with a considerable rise in advertising and promotion budget. Other expense dipped by 61.59 percent in 2022 due to lower provisioning done for WWF and WPPF. Besides, BERG didn’t book impairment of goodwill and impairment of investment in associate in 2022. Other income posted year-on-year growth of 18.75 in 2022 owing to scrap sales as well as rental income and other services charged to the related parties. Operating profit grew by 6.68 percent year-on-year in 2022; however, OP margin kept sliding to stand at 5.78 percent. Finance cost grew by 38.82 percent year-on-year in 2022 on the back of multiple rounds of monetary tightening during the year coupled with a significant increase in both short-term and long-term borrowings during the year to meet working capital requirements and to finance the installation of grid pegged solar panel plant respectively. BERG’s gearing ratio surged from 33 percent in 2021 to 41 percent in 2022. The bottomline grew by 3.41 percent year-on-year in 2022 to clock in at Rs.201.886 million with NP margin of 2.84 percent and EPS of Rs.8.22. EPS declined due to the issuance of bonus shares during the year.
Lackluster economic activity, low PSDP spending, decline in automobile sales and constricted industrial activity restricted BERG’s sales which were recorded at Rs.7341.17 million in 2023. 3.32 percent year-on-year rise in topline in 2023 came on the back of significant upward revision in prices with no noteworthy progress seen in the sales volume. Gross profit grew by 21.39 percent year-on-year with GP margin ticking up to 20.20 percent. Lower sales volume kept operating expense in check which contracted by 8.95 percent year-on-year in 2023. This was primarily due to lower advertising & promotion budget. BERG also streamlined its workforce from 413 employees in 2022 to 324 employees in 2023. Other expense rose by 423.13 percent in 2023 due to higher profit related provisioning, exchange loss, advance income tax written off as well as impairment on investment in associate and impairment on revaluation of building booked during the year. Other expense was largely offset by 31.30 percent year-on-year growth in other income recorded in 2023. This was primarily driven by higher profit on term deposits and long-term loans and also because of increased gain recorded on the disposal of fixed assets in 2023. During the year, BERG also recorded impairment loss of Rs. 73.08 million versus reversal of Rs.3.07 million booked in 2022. Operating profit grew by 49.76 percent year-on-year in 2023. OP margin also attained its highest level of 8.37 percent in 2023. Finance cost surged by 73.45 percent in 2023 due to excessive monetary tightening. BERG’s outstanding loans considerably declined during the year, resulting in a gearing ratio of 25 percent in 2023. Net profit grew by 18.91 percent to clock in at Rs.240.061 million in 2023 with EPS of Rs.9.78 and NP margin of 3.27 percent.
BERG’s net sales grew by 16.38 percent to clock in at Rs.8543.91 million in 2024. This was driven by better sales mix. BERG’s sales revenue also included Rs.450.259 million charged to Buxly Paints Limited, an associated company for material and toll manufacturing. Export sales amounted to Rs.56.586 million which included sales to Afghanistan. Optimization of prices enabled the company to enhance its gross profit by 16 percent in 2024 with GP margin clocking in at 20.15 percent. Distribution and administrative expenses surged by 23.15 percent and 10.60 percent respectively in 2024. The main drivers were advertising & promotion budget and payroll expense. BERG expanded its workforce from 324 employees in 2023 to 341 employees in 2024. Other expense slid by 52.21 percent in 2024 due to considerably lower exchange loss, no impairment recorded on the revaluation of building, no advance income tax written off and no sales tax on royalty recorded during the year. Other income also inched down by 28.64 percent in 2024 due to lower scrap sales and lesser gain recognized on the sale of property, plant & equipment in 2024. Operating profit multiplied by 18 percent in 2024 with OP margin clocking in at 8.50 percent, slightly higher than the previous year. Finance cost ticked up by 7.42 percent in 2024 due to higher discount rate and increased short-term borrowings. Gearing ratio ticked up to 26 percent in 2024. Net profit improved by 9.50 percent in 2024 to clock in at Rs.262.863 million with EPS of Rs.10.71 and NP margin of 3.1 percent.
In 2025, BERG posted year-on-year uptick of 4.69 percent in its net sales which clocked in at Rs.8944.69 million. This was due to better sales mix and price optimization measures implemented during the year. This coupled with favorable exchange rate and curtailed material cost resulted in 7.71 percent stronger gross profit in 2025 with GP margin ticking up to 20.73 percent. Distribution expense mounted by 30 percent in 2025 in line with the company’s marketing and promotion plans, increased salaries of sales force and also on the back of technical services and royalty charges paid to the parent company. Administrative expense ticked up by 8.66 percent in 2025 on account of inflationary pressure and workforce expansion from 341 employees in 2024 to 358 employees in 2025. Other expense ticked up by 0.47 percent in 2025 as higher exchange loss was greatly offset by lower impairment booked on investment in associate and on other receivables and deposits. Other expense was offset by 34.93 percent greater other income recognized during the year which was the consequence of robust scrap sales. BERG recorded 5.23 percent decline in its operating profit in 2025 with OP margin dropping to 7.69 percent. Finance cost tumbled by 26.45 percent in 2025 due to monetary easing. Net profit strengthened by 13.57 percent to clock in at Rs.298.523 million in 2025 with EPS of Rs.12.16 and NP margin of 3.34 percent.
Recent Performance (2026)
In 2026, BERG recorded 2.59 percent year-on-year uptick in its net sales which clocked in at Rs.9176.16 million. This was the result of higher sales volume and improved sales mix. Gross profit strengthened by 14.84 percent in 2026 with GP margin climbing up to 23.20 percent. This came on the back of stable exchange rate and aggressive cost cutting initiatives implemented by the company during the year. Structured promotional plans and enrichment of the company’s operations to meet the recovering demand resulted in 10.63 percent spike in distribution expense and 14.58 percent surge in administrative expense in 2026. BERG also expanded its workforce from 358 employees in 2025 to 382 employees in 2026 which resulted in higher payroll expense. Greater provisioning done for WWF and WPPF and impairment on investment in associate as well as impairment on receivables and deposits were the causes of 65.93 percent escalation in other expense in 2026. However, it was offset by stronger other income to the tune of Rs.95.86 million recorded during the year, up 1.91 percent year-on-year. This was due to improved return on financial assets as the company’s short-term investments increased during the year. A greater portion of BERG’s mark-up income comprised of interest income charged on receivable balance from Buxly Paints Pakistan Limited. An off-putting factor which kept a check on the financial performance of BERG during 2026 was a massive 375.64 percent escalation in impairment loss. This resulted in a marginal 0.92 percent uptick recorded in operating profit in 2026 with OP margin slightly dipping to 7.57 percent. Lower average borrowing rate pushed down finance cost by 15.87 percent in 2026 despite greater outstanding borrowings. Net profit inched up by 3.65 percent to clock in at Rs.309.427 million in 2026. This translated into EPS of Rs.12.60 and NP margin of 3.37 percent in 2026 – slightly higher than last year.
Future Outlook
BERG is emphasizing on cost reduction, supply chain optimization, treasury management and upward price revision. This coupled with the improvement in local macroeconomic indicators, revival of automobile sector, stimulation of infrastructure investment and increased demand of white goods will result in stronger financial results for BERG in 2027. However, the outlook is sensitive to global energy prices and currency movement.
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