INSUBCONTINENT EXCLUSIVE:
Shares of Kansai Nerolac plunged over 3 per cent in early trade on Friday after CLSA downgraded the stock to ‘Sell’, citing demand
headwinds as auto sector is reeling under pressure
The financial services firm added that auto original equipment makers contribute around 45 per cent to Nerolac’s revenue
Macro environment also raises some concerns over decorative demand
The scrip was trading 3.15 per cent down at Rs 446 around 9.22 am (IST), while the BSE Sensex was up 82 points, or 0.22 per cent, at
38,469.
Reports of Maruti cutting March production by 25 per cent is a big concern for the company, according to CLSA
The global brokerage firm cut FY19-21 EPS estimates by 2-4 per cent for Nerolac
However, it added that stronger rupee should help along with product price hikes.
The foreign firm slashed the target price to Rs 385 from
Rs 450 earlier.
For the quarter ended December 2018, Kansai Nerolac posted 9.75 per cent year-on-year fall in net profit at Rs 112.70 crore
against Rs 125.15 crore in the corresponding quarter last year
Revenue of the company increased 17.35 per cent YoY to Rs 1343.64 crore in Q3FY19 over Rs 1145.01 crore in the same quarter last year.
