Neutral Asian Paints; target of Rs 3000: Motilal Oswal

Motilal Oswal's research report on Asian Paints

Asian Paints (APNT) reported a 6% YoY growth in consolidated revenue (base -5%), with standalone sales up 6% YoY, marking growth after six consecutive quarters of decline. Two-year revenue CAGR was flat in 2Q, in line with its listed peers. Domestic decorative volumes grew 11% YoY. Extended monsoon impacted early-quarter demand, but a visible recovery was seen in September and October, supported by festive demand and improved consumer sentiment. The international business grew 9.9% YoY (+10.6% in constant currency terms).

Outlook

With expectations of better earnings, we raise our target valuation multiple to 50x (10-year average P/E) on Sep’27E EPS to derive TP of INR3,000. We reiterate our Neutral rating.