Asian Paints shares drop 6%

Shares of Asian Paints Ltd., India’s largest paint manufacturer, fell 6% on Wednesday, January 28, after mixed brokerage reactions to its December quarter results. CLSA maintained an ‘Underperform’ rating with a ₹1,875 target, noting that consolidated revenue grew 3.7%, about 2% below expectations. Standalone volumes rose 7.9% YoY, supported by a weak base, though the gap between volume and revenue growth remains a concern. Gross margins exceeded expectations due to softer commodity costs, but CLSA trimmed FY26–28 earnings forecasts by up to 7%.

HSBC downgraded the stock to ‘Hold’ with a ₹2,900 target, highlighting weak Q3 volume and revenue growth and cautioning that soft retail demand may persist. Goldman Sachs and Citi also issued ‘Sell’ ratings, citing subdued decorative paint growth and muted demand commentary.

On the positive side, Jefferies and Nomura retained ‘Buy’ ratings with targets of ₹3,300 and ₹3,250, respectively, noting respectable domestic volume growth of around 8%, strong margins at the high end of guidance, and management’s continued focus on market share expansion. Asian Paints trades at roughly 47 times March 2028 forward earnings.

Shares had closed 2.8% lower at ₹2,628 on Tuesday.