Q3FY23 Preview: Asian Paints: Revenue seen at Rs92,947 million, PAT at Rs10,426 million

18 Jan 2023 , 08:36 AM

Result date: 19^th January, 2023

Recommendation: Reduce

Target price: Rs3,125

 

Asian Paints is likely to post subdued revenue growth, due to high base and price hike anniversarization. The company’s EBITDA margin could expand by ~250 basis points sequentially to 17% in the quarter, driven by driven by moderation in input cost inflation. Moreover, Crude/TiO2 prices softened further in Q3 by 7%/5% sequentially; full benefit of this will be visible in Q4 margins.

The company’s Profit After Tax (PAT) could grow 2.6% on a year-on-year basis.

 

Important management insights to watch out for:

• Demand trends across key markets and segments
• Outlook on price hikes, margins

 

Rs Million	December 2022 estimates	YoY change
Revenue	92,947	9.0%
EBITDA	15,801	2.5%
Profit After Tax	10,426	2.6%

Source: IIFL Research