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Asian Paints Q3 Results Review - Muted Sales Growth Leads To Earning Miss: Motilal Oswal

Asian Paints reported flat volume YoY (our estimate: 5% growth) and weaker than-expected product mix in its Q3 FY23 results.

<div class="paragraphs"><p>Hand holding paint brush with colored paint. (Photo: freepik)</p></div>
Hand holding paint brush with colored paint. (Photo: freepik)

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Motilal Oswal Report

Asian Paints Ltd. reported flat volume YoY (our estimate: 5% growth) and weaker than-expected product mix in its Q3 FY23 results. Consequently, Ebitda/profit before tax/profit after tax missed our estimates by 10-11%. 

Management indicated that after a weak October 2022, partly caused by high base, demand recovered YoY in Nov-22 before reaching double-digit sales growth in Dec-22.

Nevertheless, we expect near-term volume to be under pressure with Ebitda margin under check for the next two-three years because of potential competitive pressures and expanding capacity.

Asian Paints’ valuations are fair at 52.7 times FY24E and 46.4 times FY25E earnings per share.

Click on the attachment to read the full report:

Motilal Oswal Asian Paints Q3FY23 Results Review.pdf
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