Our 28th company in the Series of Best Stocks to Buy in India for Long term 2023 is Asian Paints Ltd.
This company is good for investing purpose or not ?
Let’s start with the Company profile
Company Profile :
Asian Paints Limited is a paint company. The Company is engaged in the business of manufacturing, selling and distribution of paints, coatings, products related to home decor, bath fittings and providing of related services.
Now Let’s check the important fundamental figures of this company. This is a large cap company with Market Cap ₹2,63,081 cr. We can check more fundamental details below in depth:
Company Fundamental Detail :
PE Ratio: 86.81
Sector PE Ratio: 13.22
PE Ratio of this company is high than Sector’s PE. So it’s a Below Average PE than the peers of this company.
PB Ratio : 18.53
Sector PB Ratio : 2.55
PB Ratio of this company is high than Sector’s PB ratio. So it’s Average PB than the peers of this company.
Dividend Yield : 0.70%
Sector Dividend Yield : 2.34%
Dividend of this company is low than Sector’s dividend. So it’s Below Average PB than the peers of this company.
ROE: 23.48%
ROCE: 30.27%
ROE (Return on equity) and ROCE (Return on capital equity) is Good.
According to above data, this company is looking fundamentally average. Now We’ll check the company Financially data:
Company Financial Detail
| Year | Revenue(cr.) | Profit(cr.) |
| 2022 | 29,512.86 | 3,030.57 |
| 2021 | 22,044.44 | 3,139.29 |
| 2020 | 20,566.30 | 2,705.17 |
| 2019 | 19,513.90 | 2,155.92 |
We should check now liabilities of company also in the below table
Total Current & Non Current Liabilities
| 2022 | 2021 | 2020 | 2019 |
| 8,759.34 | 7,126.19 | 5,604.28 | 6,417.04 |
Liabilities of a company refers to the debt of that company. We should also aware the debt of company. In 2022 , Company have 8,759.34 Cr. debt.
Let’s check the Free Cash flow of the company
Free Cash flow
| 2022 | 2021 | 2020 | 2019 |
| 448.25 | 3,401.48 | 2,634.61 | 1,318.75 |
Debt Level: ASIANPAINT has more cash than its total debt.
Reducing Debt: ASIANPAINT’s debt to equity ratio has increased from 6.9% to 12.8% over the past 5 years.
Debt Coverage: ASIANPAINT’s debt is well covered by operating cash flow (155.5%).
Interest Coverage: ASIANPAINT’s interest payments on its debt are well covered by EBIT (246.3x coverage).
Share Holding Pattern
| Promotor Holding | Foreign Institution | Mutual Fund | Other Domestic Institutions | Retail & Others | |
| Dec 2022 | 52.63% | 18.11% | 3.67% | 5.53% | 20.06% |
| Sep 2022 | 52.63% | 18.56% | 3.52% | 5.08% | 20.03% |
| Jun 2022 | 52.63% | 18.51% | 3.70% | 4.89% | 20.45% |
| Mar 2022 | 52.63% | 19.45% | 3.18% | 4.39% | 20.36% |
Above table showing there is no big change in Promotors holding which is 52.63% in June 2021. FIIs invested in June 2022 with 18.11% and retail investor is 20.03%.
Investment Checklist for Asian Paints Ltd.
- The company is currently profitable
- Earnings are forecast to grow by an average of 16.1% per year for the next 3 years
- Debt level is low and not considered a risk
- Dividend of 0.73% is sustainable
- Share price has been stable over the past 3 months
- The company’s earnings are high quality
- Profit margins improved or ASIANPAINT became profitable
- They have sufficient analyst coverage
- No concerning events detected
- Shareholders have not been meaningfully diluted in the past year or recently listed
- Revenue is meaningful (₹335B)
- Market cap is meaningful (₹2,632B)
- ASIANPAINT does not have negative shareholders equity.
According to its historical performance we can predict stock target.
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Entry Buying Zone : Premium members can see only
Target: Premium members can see only
Time Horizon:Premium members can see only
Risk Profile: Premium members can see only
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Entry Buying Zone : 2500 to 2600
Target: 3400 (30% Upside)
Time Horizon: 1 Year
Risk Profile: Low Risk (Stock is 1.88x as volatile as Nifty)
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Hope you liked Our 28th company in the Series of Best stocks to buy in India for Long term 2023. We tried to cover many important things about this company, if you think anything left to cover, you can comment us and we’ll try to cover those things also.
Disclaimer: This is an Educational Initiative and is NOT registered under any SEBI regulations. All the information that we provide is just for Educational purposes and you should consult your financial adviser before taking any investment decision. Also we do NOT provide any form of Stock Tips or Advise on stocks or portfolios. My All Trades Only Education Purpose. All trades will be at your risk. You have the responsibility of any trade or any benefit or loss