Colours of stocks – Asian Paints

Last quarter was good in terms of sales for Asian Paints. It maintained top position among its peers by earning a revenue of Rs. 3171 crores. Despite a dull year, the company managed an annual revenue growth of 9.5% and earnings growth of 23.8%. It got benefited by low prices of crude as crude being the major raw material. Company also cut its prices by 2%.
However Brent crude slumped 22% during the quarter, therefore raw material prices are expected to remain low and support margins, but they may not be sustainable in the year to come.

Asian Paints also entered in waterproofing market which was dominated by companies like _Pidilite_ (Dr. Fixit). The company is finding the growth in smaller towns.
Fundamentally speaking, the company is having great potential to grow as it has various product range to offer. Investors can remain optimistic on this stock. This year rains are expected to be above average; which will see great demand from rural area and Tier-III towns post monsoon..

Advertisements

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s