New Delhi, Oct 26 : Shares of Asian Paints fell by five percent intraday on Monday reacting to a weak September quarter results.
Jefferies has downgraded the stock to hold from buy with a reduced target price of Rs. 823 from Rs. 843 per share.
Reports suggest that Asian Paints reported weak Q2FY16 mainly due to poor pricing and risk to margins. Jefferies has also cut FY16-18 earnings per share (EPS0 by five-eight percent.)
Topline growth is expected to recover to 10 percent in second half off a low base as festive sales have commenced.
Asian Paint’s net profit climbed 14.9 percent to Rs. 399 crore in the quarter ended September 2015 from Rs. 347.3 crore in corresponding quarter last fiscal.
During the period, revenue was up four percent at Rs. 3779 crore from Rs. 3633 crore on an annual basis. Deficient monsoons hit rural demand while Q2 was further led down by delayed festive season hence higher base. It saw weak growth in decorative coatings.
The stock price of Asian Paints was quoting at Rs. 818.00, down Rs. 38.75, or 4.52 percent on the charts. (ANI)