Standard Chartered negative on Asian Paints

Sanjay Singh, Associate Director, Standard Chartered Securities India is negative on Asian Paints.

Singh told CNBC-TV18, "I think the paints basket has done extremely well over last one year, two years or as long as you go back and partly in the space we used to like Asian Paints. It was a top pick for a long time. We have downgraded Asian Paints now, number one is valuations. Asian Paints because of being added to Nifty has grown up very strongly and currently trades at 30 times, which is a very significant premium to its historical valuations."
He further added, "Also we feel that this quarter will be a little disappointing for Asian Paints in particular because of the rupee depreciation as well as because of other input cost and volumes also will be little soft, so Asian Paints we are looking at a PAT growth of just about 10-12-13%, which is disappointing given the valuations. So Asian Paints is a negative call for us. Kansai Nerolac is more midcap stock, which is decently valued and hence it is outperform call but nothing very significant from here."