By Aditya Raghunath
Investing.com -- Berger Paints India Ltd (NS:BRGR) reported its results for the third quarter of FY21, which ended December 2020. Sales came in at Rs 2,118.19 crore, up 24.90% from sales in the corresponding quarter of FY20. The company reported net profit of Rs 273.97 crore in the December 2020 quarter.
However, the markets haven’t shown much love to Berger Paints as the stock dropped to Rs 768 after the results. There are mixed views from brokerage forms on what to do with Berger Paints stock.
ICICI Direct has recommended a ‘hold’ on the stock with a price target of Rs 810, an upside of 4.6% from current levels. This is a revision from its earlier price of Rs 675. The firm has said that the recent rally has factored in most of the positives.
However, another firm, Nomura, has revised its recommendation on the stock with a ‘sell’ compared to a ‘neutral’ earlier. It says that rising costs and inflation will exert pressure on Berger Paints' margins.
Paint stocks have been under pressure since the last week of January when Grasim Industries (NS:GRAS) announced it would enter the paints business. Berger Paints was trading at Rs 805 on January 25 and hasn’t been able to recover since then. Market leader Asian Paints (NS:ASPN) was trading at Rs 2,716 on January 21 and is now at Rs 2,488.