InvestorQ : Why did Berger and Asian Paints correct sharply after the Grasim paint plan announcement?
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Why did Berger and Asian Paints correct sharply after the Grasim paint plan announcement?

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Riya Dwivedi answered.
2 months ago
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A day after Grasim announced aggressively plans to top up its Rs.5,000 crore paint capex with an additional Rs10,000 crore capex, Indian paint stocks took a sharp hit. In fact, paint companies like Asian Paints and Berger have come under tremendous pressure. Grasim has set a target to manufacture up to 1,332 MLPA (million litres per annum) of paints by FY24.

Markets are worried that, with its deep pockets and commodity strength, Grasim may have an edge on the cost and the sales side in the paints business. Grasim has the potential to combine the paint market and marry it to the cement and the construction market catered to by Ultratech. That is likely to get better ROI in the paints business for Grasim.

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