Religare Institutional Research has maintained 'Sell' on Asian Paints with target price of Rs 585 in its report.

Commenting on the investment rationale, the stock broker said, "Consolidated net sales grew 18% YoY to Rs 33.2 billion, with India sales rising 17.6% YoY to Rs 27.1 billion led by 11-12% volume growth in the domestic decorative business. International growth was led by the Caribbean, UAE and Bangladesh (even as political disruptions continued to hit Egyptian markets), while the industrial business saw some recovery in the non-auto segment.

Consolidated EBITDA grew 17.6% YoY to Rs 5.2 billion with margins coming in flat YoY at 15.6%. Gross margins slid 80bps YoY to 41.9% on input cost inflation, partly offset by lower employee/other costs (-30bps/-40bps YoY). Asian Paints made a provision of Rs 251.6 million in Q1FY15 for VRS to Bhandup plant employees. Other income was up 52% YoY aided by maturing of long-tenure FMPs (Rs 110 million for Q1FY15). Adjusted PAT grew 29.3% YoY to Rs 3.56 billion, with standalone PAT growing 14.8% YoY to Rs 3.25 billion. Reported consol. PAT was at Rs 3.38 billion." 
 
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