Tue Nov 12 08:50:54 UTC 2024: ## Asian Paints Shares Plunge Over 9% After Disappointing Q2 Results
**MUMBAI, INDIA -** Shares of Asian Paints plummeted over 9% on November 11 after several brokerages expressed disappointment with the company’s underwhelming Q2FY25 performance. The decline was attributed to a challenging demand environment, increased competition, and a significant drop in profit margins.
The company’s revenue from operations fell 5.3% year-on-year to Rs 8,003 crore, missing analysts’ estimates. Consolidated net profit tumbled 42.4% to Rs 694.64 crore, significantly lower than expectations.
Several factors contributed to the disappointing results, including price reductions taken last year, higher material costs, and increased sales expenses.
Several investment firms downgraded their ratings for Asian Paints, citing concerns about the company’s performance and outlook. JPMorgan downgraded the stock to ‘Underweight’, while CLSA maintained an ‘Underperform’ rating. Nomura lowered its target price for the stock and assigned a ‘Neutral’ rating. Morgan Stanley and Jefferies also expressed cautious views, with ‘Underweight’ and ‘Underperform’ ratings, respectively.
While some analysts believe that demand could improve in the second half of the fiscal year, overall sales and EBITDA are expected to remain sluggish or flat.
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