Asian Paints Ltd. share price target

Consumer stocks have seen sustained re-rating since 2009, resulting in most stocks trading at life time high PE with life time high profit margins. We note that FY21 growth was driven by market share gains on the back of superior supply chain and distribution at expense of unorganized players. Although we believe that structural drivers led by strong rural demand outlook and gains from digitization and supply chain automation are positive, further rerating looks a daunting task. We remain structurally positive on HUL, Britannia, JUBI, TTAN and APNT, however return expectations need to be moderate. We rate D'Mart, NEST and KNPL as top picks in consumption...

Asian paints (APNT), is the market leader in the Indian paint manufacturing industry with a market share of ~53%. Strong top-line growth of 44% YoY in Q4FY21, with 48% volume growth supported by strong demand from Tier 2 to 4...

We build in consolidated revenue CAGR of ~18% in FY21-23E led by 17% and 37% revenue CAGR in paints and home improvement business respectively. For the paint business, we build in volume CAGR of 14% in FY21-23E supported by shortening repainting cycle and increasing...

We revise our rating to BUY (HOLD earlier) given the long term structural growth drivers like ,clear focus on driving volumes and profitability, improved traction in other business segments

Provision for interest rose 16.37% to Rs 29.86 crore. Provision for depreciation rose 9.69% to Rs 213.35 crore. Profit before tax grew 65.47% to Rs 1,150.46 crore. Share of profit/loss was 47.73% higher at Rs 5.85 crore. Provision for tax was expense of Rs 286.42 crore, compared to Rs 218.97 crore. Effective tax rate was 24.77% compared to 31.32%. Minority interest...

Asian Paints (APNT) reported above expected revenue while higher than expected input cost inflation lead to in-line PAT. Overall both decorative and industrial coatings business grew at high double digit volume and value. Decorative coatings business benefited from continued strong demand momentum from tier 2/3/4 markets while demand from tier 1 and metros improved sequentially. In international market; Asia, Middle East and Africa recorded double digit volume growth. Input cost inflation led to sharp contraction in gross margin. However, strict control over cost and operating leverage benefits contributed towards EBITDA margin expansion. We maintain our...

High input cost inflation, undertook price increase of 2.8% effective 1 St May We are increasing FY22/F23 EPS by 5.3%/7.6% and upgrade rating from Hold to Buy given that the structural growth drivers are getting better led by 1) Market share gains from both organized and unorganized players 2) strong innovation in Paints and coatings 3) growing usage of Putty and...

Grasim's Entry unlikely to shake paint majors Grasim Industries is entering decorative paints Industry with initial capex of Rs 50bn (FY22-24) with an aim to emerge as No2 player by leveraging Birla Asian Paints (APNT IN) Consolidated...

Asian paints (APNT), is the market leader in the Indian paint manufacturing industry with a market share of ~53%. Decorative business recorded 33% volume growth supported by festival demand and growth in Tier 2 to 4 cities, while Q3FY21 revenue grew by 25% YoY. EBITDA margin improved by 439bps YoY to 26.3% due to...

We downgrade the stock to HOLD from BUY earlier as we await better entry points and get constructive again. Our revised TP is Rs. 2,664 (Rs. 2,300 earlier) as we value the stock at 55x its FY23E EPS. Key risks to our estimates