Emkay Global Financial Services has downgraded Asian Paints to 'Accumulate' with target price of Rs 770  in its report.

Commenting on the investment rationale, the stock broker said, ''Muted volume mars results performance, consolidated revenues +6.6% yoy to Rs 35.4 billion, EBITDA +18.1% yoy to Rs 5 billion & APAT +18.4% yoy to Rs 3.3 billion. Domestic decorative volume growth moderate at ~3-4% yoy impacted by muted demand environment. Sounded cautious on demand revival, but highlighted volume uptick rests on GDP revival.

Gross margin expansion healthy aided by lower input and mix led. Cost-led benefits seems be been factored in. Hereon, volume uptick and mix improvement pivotal for further EBITDA margin expansion. Cut FY16/FY17 revenue by 4%/7% and earnings by 8%/9% citing muted near-term demand environment.

We downgrade the stock to Accumulate with revised target price of Rs 770; we feel meaningful stock price correction should be used as buying opportunity.''

Disclaimer: IRIS has taken due care and caution in compilation of data for its web site. Information has been obtained by IRIS from sources which it considers reliable. However, IRIS does not guarantee the accuracy, adequacy or completeness of any information and is not responsible for any errors or omissions or for the results obtained from the use of such information. IRIS especially states that it has no financial liability whatsoever to any user on account of the use of information provided on its website.