Asian Paints Shares Fall For Second Straight Day After Birla Opus Launch
CLSA has downgraded the stock's rating to 'sell' from 'underperform' and cut the target price to Rs 2,425 apiece.
Shares of Asian Paints Ltd. fell for the second consecutive session on Monday to a nine-month low after the launch of Grasim Industries Ltd.'s paint brand, Birla Opus.
Analysts are divided on the stock. CLSA has downgraded the stock to 'sell' from 'underperform' as it expects near-term growth and margins will not be immune to this competitive pressure, although it may maintain its long-term market position.
The brokerage has also reduced the target price on the stock from Rs 3,215 apiece to Rs 2,425 apiece, implying a downside of 15.62% from the current market price.
Macquarie has maintained 'overperform' on the stock with a Rs 4,000 apiece target price, implying an upside of 39.17%. Asian Paints will be less affected by a new entrant like Grasim, according to the brokerage.
Shares of Asian Paints fell as much as 4.63%, the lowest level since April 28, 2023, before paring some loss to trade 4.01% lower at 10:20 a.m. This compares to a 0.35% decline in the NSE Nifty 50. The stock has fallen 5% from its closing on Thursday.
The stock has risen 1.3% in the last 12 months. Total traded volume so far in the day stood at 1.13 times its 30-day average. The relative strength index was at 29.53.
Of the 37 analysts tracking the company, nine maintain a 'buy' rating, 12 suggest 'hold' and 16 recommend 'sell', according to Bloomberg data. The average 12-month analysts' price target implies an upside of 13.4%.
