19 out of the 38 analysts who cover Asian Paints now have a “buy” rating on the stock, 12 say “hold”, while seven others have a “sell” recommendation.
Nomura called Asian Paints’ Q1 results a “blowout quarter” and maintained its “buy” rating on the stock with a price target of ₹3,750, which is the second-highest on the street for the stock.
The brokerage believes that peak competition is now behind and disruption has been far and few despite significant investments from new entrants, indicating a strong moat for Asian Paints.
Asian Paints reporting an expansion in gross and operating margins was a positive surprise, contrary to expectations of a compression.
It expects Asian Paints’ Earnings Per Share (EPS) to grow at a Compounded Annual Growth Rate (CAGR) of 14% over financial year 2026-2029.
JPMorgan also called Asian Paints’ operating performance as strong during the quarter while highlighting the management confidence of sustaining the 8% to 10% decorative volume growth in financial year 2027.
However, it is expecting some consolidation in the short-term and demand trends in the second quarter will be a key share price catalyst, besides the move in crude oil prices.
JPMorgan maintained its “overweight” rating on Asian Paints with a price target of ₹2,970.
CLSA and Citi continued to maintain their bearish stance on the stock despite the strong first quarter performance.
CLSA has one of the lowest targets on the street for Asian Paints, at ₹1,860.
The brokerage said that with the elevated competitive intensity and to maintain affordability, Asian Paints is unlikely to pass on the full cost increase.
Asian Paints has warned that the second quarter margins will be lower than the first due to exhaustion of low-cost inventory and an adverse product mix, CLSA’s note stated.
Citi too has a “sell” rating on Asian Paints with a price target of ₹2,650, citing an adverse risk-reward.
However, it has increased its financial year 2027-2029 revenue estimates by 1% to 2% and Earnings per Share (EPS) projections by 4% to 6% for financial year 2027-2029 to factor in the better-than-expected margins.
Asian Paints’ revenue growth for the quarter was at a 16 quarter high, and its volumes were at the mid-point of the 8% to 10% growth range. Gross and EBITDA margins both improved for the quarter.
Shares of Asian Paints are trading 1.3% lower on Thursday at ₹2,722.8. The stock has nearly turned positive on a year-to-date basis.
