As Asian Paints trades lower after missing estimates, here's what brokerages have to say
Asian Paints share price was trading lower by three percent in morning, a day after the company missed estimates as profit flatlined. Asian Paints on May 10 reported half a percent year-on-year growth in consolidated profit at Rs 874 crore for the quarter ended March 2022, as higher input costs pressured operating profit margin. Exceptional loss of Rs 115 crore also hit profit growth. The CNBC-TV18 poll estimate for the bottomline was Rs 913 crore.Revenue from operations grew 18.7 percent to Rs 7,893 crore with domestic decorative business registering eight percent volume growth."It was yet another quarter of solid and strong double digit value growth across all businesses despite uncertainty around COVID, macroeconomic challenges and heightened geo-political tensions," Amit Syngle, managing director and chief executive, said.He further said the International business managed to deliver a double-digit revenue growth for the quarter despite severe challenges in key markets.Global research firm Citi has a neutral call on the stock and has cut the target to Rs 3,470 from Rs 3,515. It is of the view that Asian Paints reported decent results while input cost volatility continues. Demand trends remain reasonably steady despite macro challenges. EBITDA was up nine percent year on year, ahead of expectations given better cost control upside, the research firm said.