Asian Paints Ltd. share price forecast

Dalmia Bharat: Dalmia Bharat reported strong Q4FY22 result, led by a healthy rebound in its cement realisation, leading to a ~25% EBITDA beat vs ours and consensus estimates. While consolidated revenue rose 7% YoY on both realisation and volume uptick, EBITDA fell 11% on sharp energy cost inflation. Unitary EBITDA rebound 44% QoQ to INR 1,035/MT due to a healthy cement price recovery in the east, rise in share of trade sales, and op-lev gains. Continued gains in its IEX investments turned balance sheet net cash in Mar-22. Dalmia noted that its plans to expand capacity to 49mn MT by FY24E is on track. Owing to its attractive valuation, we maintain our BUY rating, with a revised TP of INR 2,030/sh (13x its Mar-24E consolidated EBITDA). Max Financial: MAXL disappointed on total APE (15% below our estimates); however, the shift in product mix towards NPAR and group credit-life resulted in higher-than-anticipated VNB margin at 31.9% (+648bps vs. estimate), leading to VNB clocking in at INR5.86bn (two-year CAGR of 35%). We flag MAXL's 500bps loss in AXSB wallet share as a key business concern and believe that maintaining/recouping this wallet share remains a key monitorable in the near to medium term. We lower our VNB estimates by 5-6% for FY23E-24E to factor in growth slowdown in banca channel and expect MAXL to deliver APE CAGR of 13%, VNB CAGR of 11%, and operating RoEVs in the range of 20-21% over FY23-24E. We retain our ADD rating, with a revised target price of INR1,030 (Sep-22E EV + 16.4x...

However, the near-term challenge still persists and we would wait to see if the visibility of the near term performance sustains before we change our rating to BUY. We continue to maintain our HOLD rating with an unchanged TP of Rs 3,200 (57x FY24E EPS).

construction activities. The decorative paint segment constitutes around 74% of total paint sales, resulting in the paint sector growing at a robust...

EBITDA margin declined by 825bps YoY to 18.1% due to inflationary pressure on input prices. However, sequentially, margins improved by 534bps YoY led by price hikes. PAT declined by 18% YoY on account of weak operating margins which was partially offset by lower tax outgo. The company has taken a price hike of 18% to 22% on a YTD basis to mitigate the pressure on input cost. The company expects the overall impact on margins to be visible in Q4....

Asian Paints consolidated net sales increased 25.61% to Rs 8527.24 crore in Q3FY22 compared (accounting for 2.45% of total sales). Operating profit margin has declined from 26.34% to 18.09%, leading to 13.74% decline in operating profit to Rs 1,542.31 crore. Raw material cost...

Cyient: Cyient reported a good quarter; revenue was up 5.9% QoQ CC (higher than our estimate) and margin performed better than expected. The services segment reported double-digit YoY growth after thirteen quarters (+4.4/12.4% QoQ/YoY CC), led by recovery in aerospace (+3.9/14.5% QoQ/YoY). The worst phase of commercial aerospace is over and, going ahead, growth will be led by Avionics and MRO revival. The management has maintained its double-digit growth guidance for services but lowered the DLM growth guidance (single digit vs. 15-20% earlier), citing fulfilment challenges. Margin guidance has been upgraded by 50bps. The deal pipeline was up 27% YoY and the company closed seven deals worth TCV of USD 69mn (+8% QoQ) in the quarter. Margin performance has been decent (over the past six quarters) but further expansion seems difficult due to rising attrition. We lower our EPS estimate by 3.5/4.6% for FY23/24E due to reduced DLM revenue guidance and a slight reduction in margin assumption. Our target price of INR 1,285 is based on 22x Mar-24E EPS. The stock is trading at 19.1/16.7x FY23/24E, a steep discount of ~55% to LTTS. Maintain BUY. Mastek: Given a strong UK government portfolio and ongoing turnaround in the US business, we maintain a BUY on Mastek, despite the fact that it had a soft Q3 (though it was in line with our estimate). The softness was mainly due to a slowdown in UK private (retail and BFSI), owing to project completions and furloughs. However, we expect Mastek's growth trajectory to revive, based on: (1) a strong footing...

We increase our FY22/FY23/FY24 EPS by 13.6%/7%/3.2% given 1) strong pentup demand 2) long runway for growth in Rurban India 3) bounce back in metro/Tier1/2 demand and 4) strong traction in project business. We believe long term structural levers remain intact led by 1) Market share gains in decorative paints from both organized & unorganized players 2) Increased...

We revise our rating to HOLD (BUY earlier) with a revised TP of Rs. 3,200 (Rs. 3,300 earlier) we continue to value the stock at 57x FY24E EPS.

Despite being in a capital intensive business, the company has maintained a strong balance sheet with RoCE, RoE of 31%, 27%, respectively Q3FY22 Results: The Q3 performance was ahead of our estimates on all fronts led...

Asian Paints (APNT) delivered volume growth ahead of our estimates (18% v/s expectation of 15%), while its sales growth was marginally lower. However, EBITDA, PBT, and PAT were below our estimates by 1215%, leading to a ~10% reduction in our FY22 EPS forecasts. Nevertheless, there is no material change in FY23E/FY24E EPS as demand continues to be healthy and margins would rebound on account of the sharp ~15% price hikes taken in 3QFY22. 4QFY22 is seeing some demand impact due to the Omicron wave; however, this is not too concerning as...

Inflationary pressure persists; price hikes on cards... Asian paints (APNT), is engaged in the business of manufacturing, selling and distribution of paints and related product to home dcor. APNT is the...

Havells India: Havells delivered a strong Q2FY22 revenue performance; however, margin was a miss. Revenue grew by 31% YoY (20% two-year CAGR, HSIE 21%), driven by broad-based performance across segments. Given that Havells has a large product range, healthy mix of B-C and B-B, and pan-India presence, it has managed to capitalise on the improving demand scenario. We believe that, in this kind of inflation, leading players will continue to tap the share gain opportunity. The miss in margin does not reflect any weakness in the business; we believe it is more temporary in nature. Gross/EBITDA margins contracted by 597/339bps YoY to 34.3/13.8%. We expect margin recovery in H2FY22. Havells is one of the best plays on the improving underlying demand (driven by housing and home improvement), share gain, and B-B revival. Trade inventory is normal; thereby, festive season and seasonal products can drive the upcoming quarters. We continue to value the stock at 55x P/E on FY24E EPS to derive a target price of INR 1,550. We believe Havells will continue to command a rich valuation (as it is one of the best plays among richly valued discretionary names). Maintain ADD. Asian Paints: Asian Paints (APNT) topline delivery (33% YoY) exceeded expectations (HSIE: 22%). The decorative business clocked 34/35% volume/value growth, underpinned by (1) strong pick-up in metros/tier-1/2 cities and expansion in projects business and (2) strong momentum in waterproofing. Despite a meaningful revenue beat (8.5%), EBITDA missed expectations by a mile (INR 9bn vs 13.2bn) as steep RM inflation dragged profitability down. Note: price...