Asian Paints Ltd. share price target

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...

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...

97.25% of total sales). Sales of Home Improvement segment rose 66.37% to Rs 195.24 crore a % of total sales (net of stock adjustments) increased from 48.66% to 58.43%. Purchase of finished goods cost rose from 7.66% to 10.05%. Employee cost decreased from 6.97% to...

Even as we continue to value the stock at 57x FY24E EPS our TP undergoes a downward revision to Rs. 3,300/share (Rs 3,550/share earlier). Maintain BUY.

The company took a price hike of 4% in Q2FY22 and has further guided to take price hikes to offset higher input prices What should investors do? Strong brand, market leadership position and a robust balance sheet condition justifies APL's premium valuation. APL has been a consistent...

Standalone revenue grew 36% YoY driven by 35% value and 34% YoY volume growth in India decorative coatings business. Volume growth in Tier 1 and 2 markets remained strong despite COVID related restrictions in certain regions and prolonged monsoon. APNT added 16 new Color Idea stores during 2QFY22. Revenue from international business grew 6%YoY to Rs 7bn; South Asian Market recorded good growth while Africa and Middle East were sluggish due to challenged related to...

Plans to offset inflation impact by price increases in next 3 months and return to 18-20% Consol EBIDTA margin levels We are changing FY22/FY23/FY24 EPS by -23.9%/-7.3%/2% on account of unprecedented input cost pressures, heightened volume focus in decorative paints & a move from share of surface to share of Space in Homes. We continue to remain positive on long term growth drivers led by 1) Market share gains in decorative paints from both organized & unorganized players due to strong focus on economy segment 2) Increased distribution with...

While the sales growth trend was healthy and the outlook remains positive, the lowest EBITDA margins in 50 quarters led to a ~38% miss on our forecasts at the EBITDA and PAT levels. The management stated that material cost inflation was the highest in four decades, and it expects this trend to persist over the near term. Further price hikes (in addition to a 4% increase in 2QFY22 and 3.5% increase in 1QFY22), cost savings, and raw material substitution could mitigate the sequential impact going forward....

Decorative business recorded 106% YoY volume growth and led to revenue growth of 91% YoY on a low base of Q1FY21. Pent-up demand from metros, Tier 1 and Tier 2 cities supported the volume growth while the South India market was impacted given protracted restrictive conditions. Input cost inflation led to a contraction in gross margin by 631bps...