Asian Paints share price cracks 9% in two sessions after Q3 results: Time to buy the dip or stay cautious?

Asian Paints Q3: Asian Paints share price came under heavy selling pressure on Wednesday, January 28, plunging as much as 6.6% in early trade to ₹2,451, making it the worst performer on the Nifty 50. The sharp fall followed the company’s December-quarter results, where lower profit and guarded management commentary on demand dampened investor sentiment.

The paint stock had already slipped around 3% in the previous session, taking the cumulative decline over two days to 9.3%. Asian Paints is now trading nearly 18% below its 52-week high of ₹2,985.50 touched in December 2025, while its 52-week low stands at ₹2,125 hit in March 2025. On a longer-term basis, the stock is up 10% over the past one year and 5% over six months, but has fallen 10% in the last one month.

Asian Paints: Q3 Results

Asian Paints reported a 4.83% year-on-year decline in consolidated net profit at ₹1,073.92 crore for the December quarter. The drop was largely due to exceptional items, including costs linked to the implementation of the new labour code and an impairment loss in a subsidiary. In the year-ago quarter, the company had posted a net profit of ₹1,128.43 crore.

Revenue from operations rose 3.71% to ₹8,867.02 crore from ₹8,549.44 crore a year earlier. During the quarter, the company booked exceptional expenses of ₹157.61 crore, comprising a one-time gratuity-related charge of ₹63.74 crore and an impairment loss of ₹93.87 crore on intangibles related to the White Teak acquisition.

Profit before exceptional items and tax increased 8.46% year-on-year to ₹1,646.70 crore, while total expenses rose 3.12% to ₹7,447.07 crore.

Asian Paints: Should you buy post Q3?

Motilal Oswal struck a cautious tone, reiterating a neutral rating with a target price of ₹2,950, implying a 20% upside potential. The brokerage cut its earnings-per-share estimates by 1–3% for FY26–28, citing sustained demand softness and intense competition. “Competition is expected to remain high even as demand improves gradually,” Motilal Oswal said, adding that the company is leaning on innovation, branding, regionalisation and execution to drive growth.

It also noted that Asian Paints has retained its EBITDA margin guidance of 18–20%, as it plans to continue investing in marketing and brand building. Motilal Oswal said it is modelling a 10% revenue CAGR over FY26–28, with EBITDA margins of around 19% in FY27 and FY28.

Meanwhile, HDFC Securities maintained its add rating with a target price of ₹2,800, indicating a 14% upside potential, pointing to early signs of demand recovery despite competitive pressures. “Operational performance was largely in line with expectations,” the brokerage said, highlighting 7.9% growth in decorative volumes, even as value growth was impacted by a shorter festive season and extended monsoon.

HDFC Securities also flagged strong momentum in the industrial segment and steady growth in overseas markets such as Sri Lanka, the UAE and Ethiopia. It added that gross margins expanded 197 basis points to 44.4%, while EBITDA margin rose 94 basis points to 20.1%, supported by lower material costs and sourcing efficiencies.

Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of Mint. We advise investors to check with certified experts before making any investment decisions.