iStockRelated
ICICI Securities has reduce call on (India) Ltd. with a target price of Rs 670. The current market price of Berger Paints (India) is Rs 772.45.
Time period given by analyst is one year when Berger Paints (India) Ltd. price can reach defined target.
Berger Paints (India) Ltd., incorporated in the year 1923, is a Large Cap company (having a market cap of Rs 75863.00 Crore) operating in Building Materials sector.
Berger Paints (India) Ltd. key Products/Revenue Segments include Paints, Enamels, Varnishes, Contract Revenue, Other Operating Revenue and Scrap for the year ending 31-Mar-2021.
Financials
For the quarter ended 30-09-2021, the company reported a Consolidated Total Income of Rs 2238.00 Crore, up 23.27 % from last quarter Total Income of Rs 1815.52 Crore and up 26.75 % from last year same quarter Total Income of Rs 1765.73 Crore. Company reported net profit after tax of Rs 219.21 Crore in latest quarter.
Investment Rationale
Berger’s revenue growth (27.7%) was lower than market leader Asian Paints revenue growth of (32.6%). However, Berger reported least EBITDA margin decline (333bps) amongst its peers Asian Paints (1090bps), Kansai (937bps) and Indigo (690bps). It believes key reasons were likely higher price hikes than market leader and lower ad-spend. While it remains structurally positive on (1) Berger’s strong positioning in value-for-money paints, (2) established distribution network especially in East India, (3) aggressive growth strategy and innovation and (4) high probability of market share gains in ancillary segments such as waterproofing and putty, it believes the premium valuations are unjustified (78x FY23E). Also increase in competitive intensity coupled with steep input inflation are likely to hurt industry profit pool in H2FY22 and FY23.
Promoter/FII Holdings
Promoters held 74.99 per cent stake in the company as of 30-Sep-2021, while FIIs owned 11.22 per cent, DIIs 3.9 per cent.
Time period given by analyst is one year when Berger Paints (India) Ltd. price can reach defined target.
Berger Paints (India) Ltd., incorporated in the year 1923, is a Large Cap company (having a market cap of Rs 75863.00 Crore) operating in Building Materials sector.
Berger Paints (India) Ltd. key Products/Revenue Segments include Paints, Enamels, Varnishes, Contract Revenue, Other Operating Revenue and Scrap for the year ending 31-Mar-2021.
Financials
For the quarter ended 30-09-2021, the company reported a Consolidated Total Income of Rs 2238.00 Crore, up 23.27 % from last quarter Total Income of Rs 1815.52 Crore and up 26.75 % from last year same quarter Total Income of Rs 1765.73 Crore. Company reported net profit after tax of Rs 219.21 Crore in latest quarter.
Investment Rationale
Berger’s revenue growth (27.7%) was lower than market leader Asian Paints revenue growth of (32.6%). However, Berger reported least EBITDA margin decline (333bps) amongst its peers Asian Paints (1090bps), Kansai (937bps) and Indigo (690bps). It believes key reasons were likely higher price hikes than market leader and lower ad-spend. While it remains structurally positive on (1) Berger’s strong positioning in value-for-money paints, (2) established distribution network especially in East India, (3) aggressive growth strategy and innovation and (4) high probability of market share gains in ancillary segments such as waterproofing and putty, it believes the premium valuations are unjustified (78x FY23E). Also increase in competitive intensity coupled with steep input inflation are likely to hurt industry profit pool in H2FY22 and FY23.
Promoter/FII Holdings
Promoters held 74.99 per cent stake in the company as of 30-Sep-2021, while FIIs owned 11.22 per cent, DIIs 3.9 per cent.
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