Asian Paints - Steady Value Creator Offering Entry Opportunity: Anand Rathi

BQ Prime’s special research section collates quality and in-depth equity and economy research reports from across India’s top brokerages, asset managers and research agencies. These reports offer BQ Prime’s subscribers an opportunity to expand their understanding of companies, sectors and the economy. .Anand Rathi Report.On industry interaction and channel checks, we expect Asian Paints Ltd.’s demand to rise, versus weak Q3 volumes. Lower input prices would help margins expand from Q4. Despite new entries (JSW Paints Ltd.), no price wars have been seen, a concern among the investor community. With the Grasim entry, we don’t expect this to change as demand is expected to be steady and industry distribution is unlikely to accept price cut, which could curb all-round profitability. The prolonged monsoon and early festivities curtailed Q3 volume growth, which rebounded in December and is expected to be healthy, per management. Our channel checks suggest some upswing in demand, post-November. But certain pockets saw keen competition from new dealers.We acknowledge the rich valuations (53 times FY24E earnings per share), but forecast 17% earnings compound annual growth rate over FY23-25 aided by margin gain. Paints companies have been the most consistent value creators over the last three/five/10 years. This would continue, aided by steady earnings growth. Risks: Sharp rise in input costs; entrants disrupting the industry, capturing considerable market share..Click on the attachment to read the full report:.JSW Steel - Robust Domestic Demand, Increase In Capacity To Drive Growth: Motilal Oswal.DISCLAIMERThis report is authored by an external party. BQ Prime does not vouch for the accuracy of its contents nor is responsible for them in any way. The contents of this section do not constitute investment advice. For that you must always consult an expert based on your individual needs. The views expressed in the report are that of the author entity and do not represent the views of BQ Prime..Users have no license to copy, modify, or distribute the content without permission of the Original Owner.

Asian Paints - Steady Value Creator Offering Entry Opportunity: Anand Rathi

We acknowledge the rich valuations, but forecast 17% earnings compound annual growth rate over FY23-25 aided by margin gain.

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