Reliance Securities has maintained 'Hold' on Asian Paints with revised target price of Rs 773 in its report.

Commenting on the investment rationale, the stock broker said, "Asian Paints have delivered muted results. While we had taken due cognizance of the hawkish commentary of Asian Paints management in 3QFY15, the results were nonetheless below estimates by ~6% at both revenue as well as earnings front. Hence, post the result, we have pruned our estimates - (1) For FY16E, revenue/earnings estimates by 3%/8%, respectively and (2) for FY17E, revenue/earnings estimates by 4%/12%, respectively. Given the discretionary nature of the business, we factor sluggish volume for the company in the near term, before a pickup in 2HFY16E. For FY16E/17E, we pen yoy sales volume growth of 11%/16%, respectively on low base (for FY16E).

Asian Paints is structurally a strong leading paint company, which derives its strength from its superior distribution network (40,000 strong dealer network) as well as entrenched brands. Hence, we maintain our Hold recommendation with revised target price of Rs 773 (Rs 876 earlier)."

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