During the second consecutive trading day on Tuesday, shares of Asian Paints reached their lowest point in the past 52 weeks. The stock of Asian Paints has fallen below Rs 2,500 for the first time in more than three and a half years, as a result of the ongoing correction that has occurred after the company’s earnings for the second quarter.
On the 5th of April, 2021, the stock reached a low point of Rs 2,484 during the trading day. Since that session, the stock has been trading at a price that is more than Rs 2,500 to this day. During the current trading session, the shares of Asian Paints fell by 1.95 percent, reaching its 52-week low of Rs 2493.05 on the BSE. As a result of Dalal Street’s dissatisfaction with the company’s profits for the second quarter, the stock reached a new annual low of Rs 2,507 on the BSE on Monday.
The total number of shares of Asian Paints that were traded was 0.68 lakh, which resulted in a turnover of 17.02 crore rupees. At that time, the market capitalization of Asian Paints was 2.39 lakh crore. A one-year beta of 0.5 for Asian Paints shares indicates that the company’s shares saw relatively little volatility over that period.
As far as technical analysis is concerned, Asian Paints’ relative strength index (RSI) is currently at 14.7, which indicates that the company is currently trading in the oversold zone. The stock of Asian Paints is now trading at a price that is lower than the moving averages for the 5-day, 10-day, 20-day, 30-day, 50-day, 100-day, 150-day, and 200-day periods.
The global broking firm Jefferies has not changed its rating of ‘underperform’ on Asian Paints and has set a price objective of Rs 2,100 for the company.
Jefferies stated that it continued to be concerned about the competition, which has also clouded the possibility of the company’s future trajectory.
Asian Paints was reduced from a “neutral” rating to a “underweight” rating by JPMorgan. Before, it had set a price objective of Rs 2,800, but it has since reduced it to Rs 2,400. Excluding the pandemic caused by the COVID-19 virus, the broking reported that household decorative paint volumes had a decline for the first time in the last ten years.
Morgan Stanley has a price objective of Rs 2,522 and considers Asian Paints to be “underweight.” The company identifies product mix, increased rebates, personnel costs, and greater selling expenditures as the major monitorables for the company.
Additionally, CLSA has a ‘underperform’ rating on Asian Paints, and the company has set a price objective of Rs 2,290 there.
The consolidated net profit of Asian Paints decreased by 42.4% year-on-year (YoY) in the September 2024 quarter, coming in at Rs 694.6 crore as opposed to Rs 1,205.4 crore that was reported in the same quarter of the previous fiscal year.
