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28 March, 2015 09:28 IST
`Buy` Asian Paints; target Rs 3,378: Firstcall
Source: IRIS Exclusive | 14 Feb, 2012, 03.45PM
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Firstcall Research has recommended `Buy` on Asian Paints with a price target of Rs 3,378 as against the current market price (CMP) of Rs 2,990 in its report dated Feb. 11, 2012. The broking house gave the following rationale:

Synopsis

Asian Paints is India`s largest paint company & Asia`s third largest paint company, with a turnover of Rs 77.06 billion.

Asian Paints has been included for the first time in Forbes Asia`s Fab 50 List of companies. 

During the quarter ended, the robust growth of Net Sales is increased by 21.95% to Rs. 25605.30 million.

The company`s Decorative Paints business segment contributes around 94% in the total paint business.

Net Sales and PAT of the company are expected to grow at a CAGR of 19% and 8% over 2010 to 2013E respectively.

Asian Paints, the group operates around the world through its subsidiaries Berger International, Apco Coatings, SCIB Paints and Taubmans.

Outlook and Conclusion

At the current market price of Rs.2990, the stock is trading at 29.50 x FY12E and 26.26 x FY13E respectively.

Earning per share (EPS) of the company for the earnings for FY12E and FY13E is seen at Rs. 101.37 and Rs.113.85 respectively.

Net Sales and PAT of the company are expected to grow at a CAGR of 19% and 8% over 2010 to 2013E respectively.

On the basis of EV/EBITDA, the stock trades at 17.95 x for FY12E and 15.85 x for FY13E. 

Price to Book Value of the stock is expected to be  at 8.97 x and 6.63 x respectively for FY12E and FY13E.

We expect that the company will keep its growth story in the coming quarters also. We recommend `BUY` in this particular scrip with a target price of Rs. 3,378 for Medium to Long term investment. 

Click here to view full report

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Asian Paints Limited   (Q,N,C,F)*

Comments Post comment 
By: Sanjeev Kumar | 20 February 2012 Reply | Forward | Report Abuse 
Reason for no bonus issue for last more than 5 yrs. of Asian Paints ltd.
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