Asian Paints Ltd. share price target

Asian Paints posted a healthy performance for 3QFY2014, both on the top-line as well as the bottom-line front. For the quarter, the companys top-line grew by 13.9% yoy to Rs4,160cr while the reported Adj.PAT grew ~35% yoy to `499cr. Key highlights: For 3QFY2016, Asian Paints consolidated top-line posted a double-digit growth of 13.9% yoy to Rs4,160cr on the back of healthy festival season demand. However, heavy rainfall in south India did impact its sales performance. The companys protective and powder coatings business did well with the segment benefitting from lower material prices. Its international business posted healthy growth, particularly in the Middle East and Bangladesh. However as per the Management, the domestic demand environment continues to be challenging. On the operating profit front, the company reported a growth of 27.9% yoy due to healthy sales growth and lower material prices. The operating profit margin was up by 197bp yoy to 18.0% due to easing material prices and employee costs as a percentage of sales. During the quarter, the company reported an adjusted net profit of 35.4% yoy to Rs499cr. Outlook and valuation: We expect Asian Paints to post a ~10.2% and ~11.9% CAGR in its top-line and bottom-line respectively, over...

Asian Paints (APL) reported outstanding results as revenues grew by 13.9% YoY (vs. our estimate of 8%) to Rs 41.6bn. The delayed start of the festive season in 3QFY16 (vs. 2QFY15) offset the negative impact caused by sluggish rural growth and price cuts. We are encouraged by APLs 3QFY16 performance, especially in a challenging environment.

Background: Asian Paints is the largest paint company in India with a market share of 50% within organised players and ranks among the top 10 decorative coating companies globally. It operates in 17 countries with 24 manufacturing facilities. Further, through subsidiaries - Berger International Limited, Apco Coatings, SCIB Paints and Taubmans it is also present in the international markets. Domestic operations however account for a predominant share of its profits. Asian Paints has ~28,000 dealers...

Management maintained a cautious stand on domestic demand and expected input cost inflation to be low in the near term; weak Indian rupee will affect cost inflation Due to subdued performance of Sleek brand, management made a provision of Rs...

Asian Paints reported strong set of numbers for 3QFY16 that exceeded our estimates. While consolidated revenues increased 13.9% to Rs41bn (6% ahead of our estimates), net profit grew by 25.8% to Rs4.6bn that was 9% ahead of our estimates. Volume growth for the quarter was ~15%, which was impressive. We expect Asian paints to post revenue and earnings CAGR of 11% and 16% respectively through FY15-18E. Based on expected EPS of Rs22.8 in FY18E, the stock is trading at price earnings multiple of 37.2x. Considering strong uptick in volumes and post introduction of...

Asian Paints revenue grew by a mere 4.0% YoY vs. our estimate of 8%) to Rs 37.8bn. Sluggish rural growth, price reductions and an early festive season in last year?s base impacted overall revenue growth.

Revenue growth (value and volume) was below our and consensus' expectations, and was impacted by expectations of poor monsoon and soft demand While growth of decorative coatings segment was subdued, growth in automotives and...

Background: Asian Paints is the largest paint company in India with a market share of 50% within organised players and ranks among the top 10 decorative coating companies globally. It operates in 17 countries with 24 manufacturing facilities. Further, through subsidiaries - Berger International Limited, Apco Coatings, SCIB Paints and Taubmans it is also present in the international markets. Domestic operations however account for a predominant share of its profits. Asian Paints has ~28,000 dealers...

Asian Paints' numbers for 2QFY16 were below our estimate. On a consolidated basis, revenue increased by 4% to Rs37.3bn compared to our estimate of Rs38.9bn. EBITDA and net profit too came in lower at Rs5.7bn and Rs4bn, respectively, which were 7% and 11% below our estimate. Taking into account the below par performance, we have reduced our revenue and earnings estimates by 3% and 9%, respectively. At the current price, the stock is trading at 47.1x FY16E and 41.4x FY17E, respectively. We...

Asian Paints reported in line revenue growth of 7.8% YoY to Rs 36.2bn in 1QFY16. However, what impressed us was (1) Strong vol growth recovery (in a challenging demand environment) in domestic decorative business (~10% YoY, led by price cuts and healthy growth in low end and premium products) after the two tepid trailing quarters (3% and 2%), (2) Multi quarter high gross margins ( 372 bps YoY), aided by RM tailwinds (lower crude and TiO2 prices).