Swot Analysis Of Nerolac Paints: Fill & Download for Free

I can’t give you suggestion, but would like to conduct some analysis for understanding purpose.First if you look at the long term chart of all three (it is a percentage growth chart from 29th Oct 2011 till yesterday), we can see all paint companies are going strong and in a long term uptrend. Also all of them have given good returns since 2014, in line with major indices, and due to fundamental factors like stable and growing demand; and the fall in crude oil prices - which is a primary and major input cost for them.Comparatively Nerolac gave highest return followed by Berger and Asian Paints respectively.Also if you look at TTM PE (for June quarter) of the three Asian Paints and Berger are trading well above 50, while Nerolac is in its early 20s. This is bit surprising but that is what the data shows. If you have a reliable database please double check.Now the question is what other factors we should consider.Asian paints is very large and has good pricing power and commercial client base such as leading car manufactures. I don’t have much knowledge about the other two but when it comes to sales they both are a third of what Asian Paints generates.This analysis can not stop here and we need more information:Why Nerolac trading at low PE?What is expected growth for these companies?What are their cost and profitability drivers and how they compare with each other? (Kinda SWOT analysis)If there is a slowdown, who is going to manage better than others?How effective is the management, leadership, and corporate governance at these cos?The list is not exhaustive, but these are among factors one should understand before taking decision.

Paint sector is heavily dependent on the real estate and the spending power of the people.Indigo paints has the ipo in the price band of Rs. 1480 to Rs. 1500. In a market where it has the fifth largest share, and the top four (Asian paints, berger paints, nerolac, and Akzo nobel) already listed in the stock market, will applying for the IPO be a good option?SWOT Analysis:Strengths: Innovative product range and focused on tier 2 and tier 3 cities.Weakness: Tight competition from established and more popular paint companies. Painting is a luxury spending to a great extent.Opportunities: Repainting market share is 78%. So, possible to establish a name for itself. Also, huge untapped market available for expansion.Threats: Constant innovation and competitive pricing required to increase market share, which may affect profits. Face humongous difficulty to capture market share from the big 4 of the paint industry.My personal opinion: Considering the high price band of the IPO, I am not too inclined to apply for it. Although a blockbuster listing is expected, still, getting just about 10 shares per lot, leaves me with little room to partly sell my shares and hold some meaningful quantity for the medium to long term. With already established players in the stock market at similar price range, I would love to give the IPO a miss. It is suitable for listing gain only, that too if the current bull market holds.