Shares of Asian Paints Ltd. fell over 4% on Thursday to the lowest in nearly two months as the company's consolidated net profit plunged 25% in the first quarter of the current financial year.
Several brokerages turned bearish on the paint maker, cutting target price and earnings estimates amid concerns of increased competitive pressures and rising costs. Nomura Research cut the earnings-per-share estimates for financial years 2025, 2026 and 2027 to 7.8%, 6.4%, and 5.7% respectively.
Asian Paints posted a profit of Rs 1,187 crore in the quarter ended June, missing a consensus estimate of Rs 1,407.3 crore by analysts tracked by Bloomberg.
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On the NSE, Asian Paints' stock fell as much as 4.45% in early trade to Rs 2,842 apiece, the lowest since May 22. It was trading 2.01% lower at Rs 2,914.5 per share, compared to a 0.33% advance in the benchmark Nifty 50 as of 9:40 a.m.
The share price has declined 17% in the last 12 months and 14% on a year-to-date basis. The relative strength index was at 49.
Sixteen out of the 38 analysts tracking the company have a 'sell' rating on the stock, 11 recommend 'buy' and as many suggest 'hold', according to Bloomberg data. The average of 12-month analyst price targets implies a potential downside of 1.1%.
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