Angel Broking has given a buy rating to Asian Paints with a target price of Rs 2,131, an upside of 16.8 per cent over a CMP of Rs 1,824.
The share price of the company moved down by -2.60 per cent from its previous close of Rs 1824.40. The last traded price is Rs 1,777. Incorporated in 1945, Asian Paints has a market cap of Rs 1,74,976.86 crore.
Investment Rationale
Asian Paints is India's largest paints company. The brokerage expects the paints company to report a healthy bottom-line CAGR of ~19 per cent over FY2019-22E due to leadership position, strong brand, wide distribution network (60,000+ dealers across the country) and improvement in operating margins (back of falling crude prices).
Financials
For the quarter ended December 31, 2019, the company reported consolidated sales of Rs 5420.28 crore, up 7.32 per cent from last quarter sales of Rs 5050.66 crore and up 2.39 per cent from last year's same quarter sales of Rs 5293.99 crore. The company reported net profit after tax of Rs 760.50 crore in the latest quarter.
Promoter/FII Holdings
Promoters held 52.79 per cent stake in the company as of December 31, 2019 while FIIs held 17.24 per cent, DIIs 10.28 per cent and public & others 19.69 per cent.