The shares of Asian Paints tumbled nearly 7 percent on January 28 as brokerages analysed the company's results for the October-December quarter of the ongoing financial year 2026.

The shares of the paint-maker dropped to Rs 2,451 apiece in the early trading hours of Wednesday. This is the lowest level seen by the stock since October last year.

Asian Paints Q3 Results:

Asian Paints on January 28 reported a consolidated net profit of Rs 1,060 crore for Q3 FY26, marking a 4.6 percent year-on-year (YoY) fall from Rs 1,110.48 crore net profit reported in Q3 FY25. This however includes exceptional items of Rs 157.61 crore due to labour code and Impairment loss following acquisition of Obgenix Software Private Limited ('White Teak').

The firm's revenue from operations meanwhile rose around 4 percent YoY to Rs 8,867.02 crore. Consolidated net sales increased 3.9 percent YoY to Rs 8,849.7 crore during the quarter under review.

Motilal Oswal on Asian Paints:

Motilal Oswal said that Asian Paints delivered a "lacklustre performance" as growth delivery remained soft despite a favorable base and multiple initiatives. "A shorter festive period and an extended monsoon did weigh on 3Q performance and further delay demand recovery," the brokerage said.

"The management commentary on demand recovery was uninspiring, especially after the constructive commentary post-2QFY26. APNT expects volumes to be in the 8-10% range and value growth of ~5% in the near term. That said, management maintained its EBITDA margin guidance of 18-20%, aided by formulation and sourcing efficiencies. We model 10% revenue CAGR over FY26-28E along with ~19?ITDA margin for FY27/FY28E," Motilal added.

Given slower demand recovery and competitive pressure, Motilal expects the near-term growth outlook to remain muted. "However, as the paint category enjoys pentup demand, we will be watchful if the recovery pace picks up faster in the coming seasonal quarters. The company is focusing on product innovation, brand salience, regionalization, and execution excellence to negate competitive pressure," it added.

Motilal cut its EPS estimates by 1-3 percent over FY26-28E. It reiterated its ‘Neutral’ rating on the stock, with a target price of Rs 2,950 apiece, which implies an upside potential of nearly 12.5 percent over the stock's previous closing price.

JM Financial on Asian Paints:

M Financial said that the company's Q3 results were marginally below expectation. "Decorative volume/value growth of 7.9%/2.8% YoY was below ours and consensus estimate, despite weak base, owing to shorter festive (impacted October sales, November/December had better growth) and extended monsoons. Management remains cautious on demand trends – a) sees mid-single-digit sales growth as reasonable in near term led by volume growth of c.8-10% and negative price/mix impact of c.4-5% (similar to trends seen in 2Q/3Q), b) prolonged softness in industry growth seen due to some reduction in frequency of painting/occasion-led painting and consumer shift to other discretionary spends. Moreover, based on current trends the negative mix impact (c.4-5%) is likely to sustain for next few quarters (will percolate into FY27E)," the brokerage said.

It cut FY27/28E earnings estimate by 2-3 percent. JM Financial maintained its ‘Reduce’ call on the stock, while lowering its target price to Rs 2,735 apiece. This implies an upside potential of more than 4 percent from the stock’s previous closing price.

CLSA on Asian Paints:

CLSA kept an ‘Underperform’ call on the shares of Asian Paints, with a target price of Rs 1,875 apiece. This implies a downside potential of more than 28.5 percent over the stock’s previous closing price.

The international brokerage said that the firm’s consolidated revenue growth was 2 percent below forecast, while standalone volume growth of 7.9 percent was in-line with an earlier festive season.

It cut FY26-28 earnings estimate by 0-7 percent to account for persistence in gap between revenue and volume growth.

HSBC on Asian Paints:

HSBC downgraded the shares of Asian Paints to ‘Hold’, and cut its target price to Rs 2,900 per share. This implies an upside potential of nearly 11 percent over the previous closing price.

The international brokerage said that the firm saw disappointing volume and revenue growth in Q3 FY26. Relatively weaker retail demand trends could persist longer, it added.