Asian Paints (APNT IN) – Q2FY27 Result Update – Steady demand outlook, competition remains elevated – HOLD
Published on 29 Oct 2026
APNT has given cautiously optimistic outlook on 2H demand and margins led by 1) sustained traction in demand across both rural and urban India 2) growing strength of services business in paints, B2B, waterproofing and preventive maintenance and 3) likely benefits from VAE facility in new product development, innovations and profitability. While both Auto and General industrial paints have grown at a brisk pace, we expect lower growth in Auto paints as anniversary of GST cuts is over. We expect competitive intensity to reman elevated as players like Birla Opus, JSW Akzo and JK Cement continue to expand distribution and product range.
We expect double-digit earnings growth to sustain over the next two quarters given strong festival sales and benefits of price hikes, however volatility in margins can remain high as crude prices and supply chain disruptions continue. We believe margin accretion from VAE facility holds key to upgrade in earnings and restoring competitive edge in the long term. We estimate a revenue/EPS CAGR of 9.9% over FY26–29 and value the stock at 42xSept28 EPS. We retain Hold with revised target price of Rs2544 (Rs2720 valued at 46xJune28 EPS). Retain Hold.
