Mar'25 View on Kansai Nerolac Paints Ltd

Kansai Nerolac Paints is principally engaged in the manufacturing of Paints and is a market leader in Industrial coatings. It started its operations in 1920 as Gahagan Paints & Varnish in ***** company is subsidiary of Kansai Paints Co. Ltd Japan, from whom it continuously gets support and guidance in improvement of quality standards and getting best technology upgrades. The stock is down from its recent high near 320 and made a low of 220 and i snow resting at 20EMA level and looks to touch its 200EMA level of 265 and above on back of following positive data. • KNPL’s revenue grew 1.5% yoy to Rs1842.2 cr(1.6% beat). • We estimate ~7% yoy growth in industrial coatings. • KNPL is expecting a gradual recovery led by budgetary measures. • Management has retained its margin guidance at 13-14%. • KNPL reported 1.5% revenue growth led by industrial coatings. • KNPL is more vulnerable to the changing competitive landscape. • We expect earnings to grow by 6.9% in FY26E & grow by 7.3% in FY27E. • Stock is currently trading at valuation of 25.8x P/E FY27E EPS.