Asian Paints Ltd., incorporated in the year 1945, is a Large Cap company (having a market cap of Rs 245194.94 Crore) operating in Building Materials sector.
Financials
For the quarter ended 31-03-2021, the company reported a Consolidated Total Income of Rs 6726.84 Crore, down -2.32 % from last quarter Total Income of Rs 6886.39 Crore and up 43.39 % from last year same quarter Total Income of Rs 4691.39 Crore. Company reported net profit after tax of Rs 864.04 Crore in latest quarter.
Investment Rationale
While the company has taken a 2.8% price increase in Apr’21 and is considering another hike, the steep material cost inflation since Dec’20 will put pressure on gross and EBITDA margin as it did in 4QFY21, when EBITDA and PAT were below estimates. The brokerage expects a 60bp YoY dip on the EBITDA margin front in FY22E from record high levels of 22.4% in FY21, before returning to FY21 levels in FY23E. While sales growth has been strong and it expects the company to bounce back after the impact of the ongoing second COVID wave recedes, valuations at 58.6x FY23E EPS fully capture the upside from a one-year period.
Promoter/FII Holdings
Promoters held 61.7 per cent stake in the company as of March 31, 2021, while FIIs held 20.4 per cent, DIIs 7.4 per cent and public and others 19.5 per cent.
(Views and recommendations given in this section are the analysts’ own and do not represent those of ETMarkets.com. Please consult your financial adviser before taking any position in the stock/s mentioned.)
