Kotak Securities is bullish on Kansai Nerolac Paints has recommended buy rating on the stock with a target price of Rs 600 in its research report dated April 09, 2018.
Kotak Securities' research report on Kansai Nerolac Paints
We recently interacted with the management of Kansai Nerolac Paints (KNPL) to understand the developments in the company and in the sector. KNPL has been experiencing double digit volume YoY growth across segments since the last 12 quarters surpassing the performance of Asian Paints and Berger. The strong out-performance is on the back of: 1) Strong volume growth witnessed by the paint sector; 2) New and innovative product launches by the company; 3) Strong distribution network of the company (20000+ dealers and 102 depots);4) Heavy promotion through multiple media platforms and 5) Sales aggression exhibited by the company. Management (and we agree) expect the growth momentum to continue in medium term as well with increasing disposable income, healthy GDP growth, strong automotive demand and private/public sector capex in the country.
OutlookRecommend BUY with an unchanged TP of Rs 600 at 44x FY20E earnings
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