Asian Paints shares hit new all-time high, should you buy?

By: | Updated: May 12, 2016 4:18 PM

Asian Paints hit their new all-time high of Rs 928 on Thursday after the company on Wednesday reported 19.88 per cent rise in its consolidated net profit figures at Rs 408.75 crore for the quarter ended March 2016 against Rs 340.97 crore in the same quarter a year ago.

Asian PaintsAsian Paints hit their new all-time high of Rs 928 on Thursday after the company on Wednesday reported 19.88 per cent rise in its consolidated net profit figures at Rs 408.75 crore for the quarter ended March 2016.(Image: AsianPaints)

Asian Paints hit their new all-time high of Rs 928 on Thursday after the company on Wednesday reported 19.88 per cent rise in its consolidated net profit figures at Rs 408.75 crore for the quarter ended March 2016 against Rs 340.97 crore in the same quarter a year ago.

At 10.31 am, shares of Asian Paints were trading 1.66 per cent up at Rs 922.50. The scrip opened at Rs 920 and has touched a high and low of Rs 928 and Rs 915, respectively, in trade so far. Later, the shares of the company closed 2.13 per cent up at Rs 926.75.

Consolidated net sales of the company grew 12.29 per cent year-on-year at Rs 3,919.23 crore for the quarter ended March 2016. It has posted net sales of Rs 3535.03 crore in the same quarter last year.

According to Religare Institutional Research, Asian Paint’s Q4FY16 results were largely in line with estimates.

Emkay said, “Yet another stellar show on volumes and margins. Drivers well in place for sustaining healthy double-digit volume growth on the back of pay commission hike, normal monsoon and sustained traction in smaller cities.” The brokerage house retains ‘Buy’ rating on Asian Paints shares with target price of Rs 950. as the recent run-up leaves limited room for upside.”

In the past one year, the share price of Asian Paints jumped 17.36 per cent to Rs 907.40 till May 11.

Religare has ‘Sell’ rating on Asian Paints. The brokerage house said, “We believe the positive aspects of Asian Paints’ business model are priced in, but the risks of slower value growth, lower margins and investments in new initiatives are not in the price. We believe the share price can touch Rs 800 by March 2017.”

(With agency inputs)

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