PREFACE

Management is the art of getting things done through others. Today, we find management in
every field. It is a developing field. Due to the increasing complexities in the financial area, its
principles frequently change. Today, the finance function has played a significant role in the field
of management.

True learning happens through experience and observation. To improve further, new tools and
techniques have been developed to meet the needs of modern businesse s working in
complex environments.

We being P.G.D.M. students got a great opportunity to improve our practical knowledge in
the field of financing, having only theoretical knowledge is immaterial without practical
knowledge.

There is a vast difference between a paper plan and its implementation. Practical knowledge
proves that experience is the best teacher, and as a result, We have understood and analyzed the
information about ASIAN PAINTS LTD.
ACKNOWLEDGEMENT

Through this acknowledgment, we express Our sincere gratitude towards all those people
who helped us in preparing this project report, which has been a great learning experience.

At the outset, we would like to sincerely acknowledge the valuable guidance rendered by our
professor Rattan Sharma. A good idea needs nurturing to grow to full potential and that nurturing
was done by him in the form of his suggestions, value additions, and constructive criticism during
the entire project despite his busy schedule and workload.

Finally, we would also like to thank our friends and classmates for their help and suggestions.
TABLE OF CONTENTS
Sr.No: CONTENT

1 INTRODUCTION

2 ECONOMIC ANALYSIS

3 INDUSTRY ANALYSIS

4 FINANCIAL STATEMENT ANALYSIS

5 Ratio analysis
Profit And Loss Statement Analysis
Balance sheet Analysis
DU-Pont Analysis

6 FINDINGS OF THE ANALYSIS

7 SUGGESTION

8 CONCLUSION

9 BIBLIOGRAPHY
INTRODUCTION OF THE COMPANY
Asian Paints Limited was established way back on February 1, 1942, and today stands as India’s
largest paint company and Asia’s third largest paint company with an annual turnover of Rs
30,078.40 crore.

Presently the company has had its presence in 15 countries with 26 manufacturing locations, over
10,000 SKUs, and Integrated SAP - ERP & i2 - SCM solutions. Besides Asian Paints, the group
operates around the world through its subsidiaries Berger International, Apco Coatings, SCIB
Paints, and Taubman’s.

The company manufactures paints in the category of Decorative, Automative, and Industrial
segments. Apart from these the company also manufactures various Accessories like Wall
primers, Wood primers, Putty and Stainers, etc.

Asian Paints along with its subsidiaries has operations in 20 countries across the world and 28
paint manufacturing facilities, servicing consumers in 65 countries through Berger International,
SCIB Paints-Egypt, Asian Paints, Apco Coatings, and Taubman’s. Asian Paints operates in 5
regions across the world viz. South Asia, Southeast Asia, South Pacific, Middle East, and
Caribbean region through the five corporate brands viz. Asian Paints, Berger International, SCIB
Paints, Apco Coatings and Taubman’s. In 10 markets, it operates through its subsidiary, Berger
International Limited; in Egypt through SCIB Paints; in 5 markets in the South Pacific, it operates
through Apco Coatings and in Fiji and Samoa it also operates through Taubman’s.
The company is having state-of-the-art supply chain system using cutting-edge technology to
integrate all its plants, regional distribution centers, outside processing centers, and branches in
India. All the company’s paint plants in India, two chemical plants, 18 processing centers, 350
raw material and intermediate goods suppliers, 140 packing material vendors, 6 regional
distribution centers, and 72 depots are integrated.

The company is having a big and experienced R&D team which has successfully managed to
develop High-end exterior finished and wood finishes in-house, which was earlier imported into
the country. These products are currently marketed under Asian Paints Elastomeric Hi-Stretch
Exterior paint and Asian Paints PU wood finish respectively.

The company is having three subsidiaries viz, Apco Coatings - it is a subsidiary of Asian Paints in
the South Pacific islands. The company operates in Australia, Fiji, Tonga, Solomon Islands and
Vanuatu under the brand name of Apco Coatings.
On the recommendations of Booz, Allen and Hamilton, Asian Paints restructured itself into
Growth, Decorative and International business units and has adopted SCM and ERP technology.
Asian Paints aims to become the 5th largest decorative paint company in the world.
Product range of the company includes:

• Automotive Paints
• Decorative Paints
• Industrial Paints
Ancillaries - Range of ancillaries like primers, fillers stainers, and a lot more.

Milestones:
1957 – 66 - The family-owned company makes the transition to a professionally managed
organization. British company Balmer Lawrie rejects the products of a giant British paint
company in favor of Asian Paints. Asian Paints embarks on an ambitious grassroots marketing
campaign, partnering with thousands of dealers in small towns all over India.

1945 - Asian Paints touches a turnover of Rs. 3,50,000, with an innovative marketing strategy 'to
reach consumers in the remotest corners of the country with small packs.' 1954 - Asian Paints
mascot, Gattu, the mischievous kid, is born.

1st February 1942 - Armed with little knowledge and great determination, Champak Lal H.
Choksy, Chimanlal N. Choksi, Suryakant C. Dani and Arvind R. Vakil get together to
manufacture paint in a garage on Foras Road, Bombay. They name their company 'The Asian Oil
& Paint Company', a name that they picked randomly from a telephone directory.
ECONOMIC ANALYSIS
1. Market Position
Leading Player: With a substantial market share of over 40% in the Indian market,
Asian Paints is the biggest
paint company in India and among the top decorative paint firms worldwide.
Brand Strength: With a presence in more than 15 countries, the company is renowned for its
robust brand equity and wide distribution network.

2. Financial Performance:
Revenue Growth: Asian Paints reported a consistent growth in revenue for FY 2024, with
projected revenues of about ₹30,000 crores, or roughly $4 billion. Strong demand in both the urban
and rural segments is the main driver of this expansion.
Profit Margins: The company has consistently maintained strong profit margins, often between 15 and
20 percent, thanks to cost-cutting measures and effective operations.
Stock Performance: As of the beginning of 2024, Asian Paints' stock has shown strength in the eyes of
investors, and its steady dividend payments have served to accentuate its appeal as a buy.

3. Financial Aspects
GDP Growth: The construction and housing industries will profit from India's strong GDP growth
anticipated for 2024, which is expected to be between 6 and 7%. This will help the paint industry.
Prices of Raw Materials: Variations in the cost of raw materials, such as chemicals and titanium
dioxide, can have an impact on profits. To reduce these risks, Asian Paints has concentrated on
strategic sourcing and backward integration.
Impact of Inflation: Although consumer spending may be impacted by inflation, the company's
product diversity acts as a buffer against changes in the economy.
4. Takeaways from Strategy
Product Innovation: Asian Paints keeps funding research and development, launching cutting-edge and
environmentally friendly goods (smart paints, waterproofing solutions, etc.).
Digital Transformation: By embracing e-commerce and digital marketing techniques, the business has
increased customer interaction and broadened its online sales channels.
Sustainability Focus: Asian Paints is devoted to sustainable practices, including lowering carbon
emissions and boosting energy efficiency in production operations.
5. Difficulties
Intense Competition: The paint industry is aggressive, with multiple firms (e.g., Berger Paints, Nippon
Paint) fighting for market share, requiring ongoing innovation and marketing efforts.
Economic Downturn Risks: Consumer spending and the demand for paints may be impacted by
prospective downturns in the global economy or domestic economic difficulties.
Regulatory Compliance: Adherence to environmental norms and standards may require supplementary
financial outlays.
6. Future Outlook
Future Growth Prospects and Outlook: The real estate industry's expansion and rising consumer
expenditure on home renovations are driving Asian Paints' strong future outlook.
Plans for Growth: It is projected that the company will continue to prioritize growing its global
operations and bolstering its product line, particularly in emerging regions.
Digital Strategies: Future growth is anticipated to be largely dependent on utilizing technology to
improve consumer interaction and operational efficiency.
Management and Governance Analysis

S.no Name Designatio Directorship Education

n
1 R. Seshasayee Chairman Non- No details for the same
Executive
Director
2 Manish Choksi Vice- Non- Bachelor of Chemical Engineering
Executive and an MBA with specialization in
Chairman Director
Entrepreneurial Management and
MIS Program from the University of
Houston, USA.
3 Amit Syngle CEO Managing Mr. Amit Syngle holds a BE –
Director Mechanical degree from Panjab
Engineering College and has done
MBA from CBM Panjab University.
4 Malav Dani Chairman- Non- His formal education was rounded
CSR Executive off with a six-year stint at General
Director Electric (GE), during which he
completed the Information
Management Leadership (MLP)
program as well as the Quality Six
Sigma Black Belt Program.
5 Amrita Vakil Non- Michigan State University. B.Sc
Executive Human Resource & Economics.
Director
1998 - 2002.
6 Nehal Vakil Non- Ms. Nehal Vakil holds a degree in
Executive Bachelor of Arts with specialization
Director in Finance from Eli Broad College of
Business, Michigan State University
– East Lansing, Michigan, USA.
 Management and Governance Analysis
• Independent Directorship
S.no Name Directorship Info

1 Milind Sarwate Independent Director 1. Mr Milind Sarwate is a Chartered Accountant (1983)

2. Cost Accountant (1983), Company Secretary (1984)
3. CII-Fulbright Fellow (Carnegie Mellon University, U S A,
1996)
4. He has been awarded ICAI CFO Award (2011), CNBC
TV-18 CFO Award (2012) & CFO India Hall of Fame
induction (2013).
5. He is the Founder & CEO of Increate Value Advisors LLP.
2 Ireena Vittal Independent Director 1. Bachelor’s degree in Science (Electronics) from
Osmania University, Hyderabad.
2. Post Graduate Diploma in Business Management from
the Indian Institute of Management, Calcutta.
3. Was a partner with McKinsey & Co. for 16 years.
4. She has co-authored several studies relating to
agriculture and urbanisation.

3 Soumitra Bhattacharya Independent Director 1. Mr. Bhattacharya has been associated with the Bosch Group
for more
than 28 years.
2. Chartered Accountant from the Institute of Chartered
Accountants of India.
3. Led as Chair of the CII (Confederation of Indian
Industry) National Committee on MNCs from 2020 till
2023.
4. Mr. Bhattacharya’s career spans 39 years of professional
experience in the Corporate World.
4 Gopichand Katragadda Independent Director 1. Ph.D. in Electrical Engineering from Iowa State
University, Ames, Iowa, USA.
2. M.S., Electrical Engineering from Iowa State University,
Ames, Iowa, USA. 3. Dr.
Gopichand Katragadda is the Founder and CEO of Myelin
Foundry, an AI
company.
4. Till January 2019, Dr. Gopichand Katragadda was the
Group Chief Technology Officer and Innovation Head of Tata
Sons.

• Comments
• Overall the company management looks strong and dedicated to grow the business further, none of the
board members have been a part of any fraud or scam.
• The management team has a lot of expertise and is a diverse team with each member having
expertise in various fields, none of them have any major political connections as of now.
• The company has shown consistent growth under the team and company's financial health has been
maintained well till now. The independent board of directors come from various domains and all of them have
a strong background in their respective domains.
 Management and Governance Analysis

• Shareholding Pattern

Shareholders Sep-22 Dec-22 Mar-23 Jun-23 Sep-23 Dec-23 Mar-24 Jun-24

Indian Promoters 52.63% 52.63% 52.63% 52.63% 52.63% 52.63% 52.63% 52.63%
Foreign Promoters 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00%
Total Promoters 52.63% 52.63% 52.63% 52.63% 52.63% 52.63% 52.63% 52.63%
Mutual Funds 3.70% 3.67% 3.70% 3.55% 3.47% 3.46% 3.75% 3.80%
Financial institution/Banks/Insurance 4.27% 4.63% 5.40% 5.68% 5.81% 6.35% 7.16% 7.84%
Government 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00%
FII 18.56% 18.11% 17.02% 17.48% 17.65% 17.32% 15.89% 15.27%
Other 0.81% 0.90% 0.90% 0.81% 0.77% 0.77% 0.75% 0.72%
Total Institution 27.34% 27.31% 27.02% 27.52% 27.70% 27.90% 27.55% 27.63%
Bodies Corporate 5.52% 5.45% 5.46% 5.43% 5.41% 5.39% 5.39% 5.38%
Individuals 12.69% 12.82% 13.10% 12.66% 12.47% 12.31% 12.61% 12.51%
NRIs/OCBs 1.26% 1.26% 1.27% 1.25% 1.24% 1.22% 1.25% 1.26%
ADR/GDR 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00%
Others 0.56% 0.53% 0.52% 0.51% 0.55% 0.56% 0.57% 0.59%
Total Non-Institution 20.03% 20.06% 20.35% 19.85% 19.67% 19.48% 19.82% 19.74%
Grand Total 100.00% 100.00% 100.00% 100.00% 100.00% 100.00% 100.00% 100.00%

FII vs Promoters
Total Promoters 60.00
%
60.00%

50.00%

40.00%
40.00
30.00% %

20.00%

10.00%
20.00
0.00%
%

Sep-22 Dec-22 Mar-23 Jun-23 Sep-23 Dec-23 Mar-24 Ju

0.00
%
COMPETITORS
Asian Paints is a dominant player in the Indian paint industry, but it faces competition from several other
companies. Here are some of its major competitors:
Domestic Competitors:
• Berger Paints India Ltd: Berger Paints is one of the largest paint companies in India, known for its
quality products and strong distribution network.
• Kansai Nerolac Paints Ltd: Kansai Nerolac is another major player in the Indian paint market,
offering a wide range of products for both residential and industrial use.
• Akzo Nobel India Ltd: Akzo Nobel is a multinational company with a significant presence in India.
It offers a variety of paints and coatings for different applications.
• Indigo Paints Ltd: Indigo Paints is a relatively new entrant to the Indian paint market, but it has
gained a strong foothold with its innovative products and aggressive marketing.
• Shalimar Paints Ltd: Shalimar Paints is a well-established Indian company with a focus on
industrial coatings.
International Competitors:
• Dulux: Dulux is a popular paint brand owned by Akzo Nobel. It has a strong presence in many
countries, including India.
• Nippon Paint: Nippon Paint is a Japanese paint company that has expanded its operations to India. It
is known for its high-quality products and innovative technology.
• Sherwin-Williams: Sherwin-Williams is a leading paint company in the United States, with a
growing presence in India. It offers a wide range of paints and coatings for both residential and
commercial use.
These are just a few of the major competitors that Asian Paints faces in the Indian paint market. The
competition is intense, and Asian Paints must continually innovate and improve its products and services to
maintain its market leadership.
 1. RATIO ANALYSIS

LIQUIDITY RATIO

CURRENT RATIO

The current ratio is a liquidity ratio that measures a company’s ability to pay short-term obligations. In
a sound business a current ratio of 2:1 is considered an ideal one. High ratio indicates sound solvency
and low ratio indicates inadequate working capital. Current ratio is an index of the firm’s financial
stability.

Current ratio = Current Assets/Current liabilities

Current Ratio = Current Asset/Current Liabilities

TABLE 5.1.1 CURRENT RATIO

YEAR CURRENT RATIO

2.25
2022-23 2.37
2023-24 2.34

Current Ratio
20

15

10

0
Jan-22 Jan-23
Quick ratio /Acid Test Ratio = Quick Assets/Current Jan-24
liabilities
TABLE 5.1.2 QUICK RATIO

YEAR QUICK RATIO

2021-22 1.32
2022-23 1.47
2023-24 1.52

Quick Ratio
20
18
16
14
12
10
8
6
4
2
0
Jan-22 Jan-23 Jan-24
5 .1.3 ABSOLUTE LIQUIDITY RATIO

This is also known as super quick ratio or cash ratio. In calculating this ratio, both inventories and
receivables are deducted from the current assets to arrive at absolute liquid assets such as cash, bank and
easily marketable investments in securities. The ideal Absolute liquidity ratio is 1:2 Higher the ratio,
the higher is the cash liquidity.

Absolute Liquidity Ratio = Cash + Marketable securities

/Current Liabilities

TABLE 5.1.3 ABSOLUTE LIQUIDITY RATIO

YEAR ABSOLUTE
LIQUIDITY RATIO

2021-22 0.25

2022-23 0.11

2023-24 0.10

Liquidity Ratio
20

15

10

0
Jan-22 Jan-23 Jan-24
SOLVENCY RATIO

DEBT EQUITY RATIO

This ratio indicates the relative proportion of debt and equity in financing the assets of a firm. An
acceptable norm for this ratio is considered to be 2:1. A high ratio shows that the claims of creditors
are greater than those of owners. From the point of view of the company, the lower this ratio, the less
the company has to worry about meeting its fixed obligations.

Debt equity ratio = Outsider Funds (Total

Debts)/Shareholder Funds or Equity

TABLE 5.1.4 DEBT-EQUITY RATIO

YEAR DEBT-EQUITY RATIO

2021-22 0.00

2022-23 0.00

2023-24 0.00

.
ACTIVITY RATIO

FIXED ASSET TURNOVER RATIO

This ratio measures a company’s ability to generate sales from its investments in fixed assets such as
plant and machinery, land and building, etc. Generally, a high ratio indicates efficient utilization of
fixed assets in generating sales and a low ratio may signify that the firm has an excessive investment in
the fixed assets.

Fixed assets turnover ratio = Net sales/ Fixed asset

TABLE 5.1.7 FIXED ASSET TURNOVER RATIO

YEAR RATIO

2021-22 1.34

2022-23 1.42

2023-24 1.27

Fixed Asset Turnover Ratio

20

15

10

0
Jan-22 Jan-23 Jan-24
PROFITABILITY RATIOS

GROSS PROFIT MARGIN

The gross profit ratio plays an important role in two management areas. In the area of financial
management, the ratio serves as a valuable indicator of the firm ability to utilize effectively outside
source of funds. The ratio expected the relation between the gross profit and sales

Gross Profit Ratio = Gross Profit /Net sales *100

TABLE 5.1.10 GROSS PROFIT MARGIN

YEAR GROSS PROFIT MARGIN

2021-22 15.34

2022-23 16.83

2023-24 20.40

Gross Profit Margin

20
18
16
14
12
10
8
6
4
2
0
Jan-22 Jan-23 Jan-24
5.1.11 NET PROFIT RATIO

Net profit ratio is a measure of the overall profitability. A firm with a high net profit ratio is in an
advantageous position to survive in the face of rising cost of production and falling selling prices.

Net profit margin or ratio = Net Profit / Net Sales

TABLE 5.1.12 NET PROFIT RATIO

YEAR NET PROFT RATIO

2021-22 12.44

2022-23 13.63

2023-24 17.24

Gross Profit Margin

20
18
16
14
12
10
8
6
4
2
0
Jan-22 Jan-23 Jan-24
BALANCE SHEET
PARTICULAR Mar 24 Mar-23 Mar-22
EQUITIES AND LIABILITIES
SHAREHOLDER'S FUNDS
Equity Share Capital 95.92 95.92 95.92
Total Share Capital 95.92 95.92 95.92
Reserves and Surplus 18,329.17 15,489.64 13,253.17
Total Reserves and Surplus 18,329.17 15,489.64 13,253.17

Total Shareholders Funds 18,425.09 15,585.56 13,349.09

NON-CURRENT LIABILITIES
Long Term Borrowings 35.58 49.36 16.16
Deferred Tax Liabilities [Net] 187.61 177.84 205.3

Other Long Term Liabilities 948.29 709.51 522.05

Long Term Provisions 164.32 176.11 168.29
Total Non-Current Liabilities 1,335.80 1,112.82 911.8
CURRENT LIABILITIES
Short Term Borrowings 17.86 0 0
Trade Payables 3,238.83 3,045.86 3,497.29
Other Current Liabilities 2,926.46 2,739.25 2,112.07
Short Term Provisions 37.86 46.35 38.08
Total Current Liabilities 6,221.01 5,831.46 5,647.44
Total Capital And Liabilities 25,981.90 22,529.84 19,908.33
ASSETS
NON-CURRENT ASSETS
Tangible Assets 5,269.23 4,568.52 4,475.83
Intangible Assets 91.03 74.17 78.11
Capital Work-In-Progress 2,560.93 978.04 225.47
Fixed Assets 7,921.19 5,620.73 4,779.41
Non-Current Investments 2,609.11 2,314.28 1,646.25
Long Term Loans And Advances 0 0 0
Other Non-Current Assets 898.39 719.1 734.75
Total Non-Current Assets 11,428.69 8,654.11 7,160.41
CURRENT ASSETS
Current Investments 3,095.47 2,597.37 2,164.34
Inventories 5,074.76 5,321.79 5,277.61
Trade Receivables 3,633.45 3,462.61 2,915.77
Cash And Cash Equivalents 349.8 362.88 308.57

Short Term Loans and Advances 0 0 0

Other Current Assets 2,399.73 2,131.08 2,081.63
Total Current Assets 14,553.21 13,875.73 12,747.92
Total Assets
25,981.90 22,529.84 19,908.33

OTHER ADDITIONAL
INFORMATION
CONTINGENT LIABILITIES,
COMMITMENTS
 Contingent Liabilities 1,339.21 2,244.51 1,225.43
CIF VALUE OF IMPORTS
EXPENDITURE IN FOREIGN
EXCHANGE

Expenditure In Foreign Currency 4,123.62 4,424.41 4,156.76

REMITTANCES IN FOREIGN
CURRENCIES FOR DIVIDENDS
Dividend Remittance In Foreign
- - -
Currency
EARNINGS IN FOREIGN
EXCHANGE
FOB Value Of Goods - - -
Other Earnings 182.2 189.26 185.03
BONUS DETAILS
Bonus Equity Share Capital 93.99 93.99 93.99

NON-CURRENT INVESTMENTS
Non-Current Investments Quoted
796.11 778.74 549.62
Market Value
Non-Current Investments
2 1.49 -
Unquoted Book Value
CURRENT INVESTMENTS
Current Investments Quoted
3,095.47 2,548.05 2,164.34
Market Value
Current Investments Unquoted
- 49.32 -
Book Value

PROFIT & LOSS ACCOUNT

 Mar 24 Mar-23 Mar-22

INCOME
Revenue From 30,727.71 29,953.12 25,002.09
Operations [Gross]
Revenue From 30,727.71 29,953.12 25,002.09
Operations [Net]
Other Operating 122.41 125.28 186.42
Revenues
Total Operating 30,850.12 30,078.40 25,188.51
Revenues
Other Income 824.56 518.01 451.89
Total Revenue 31,674.68 30,596.41 25,640.40
EXPENSES
Cost Of Materials 13,418.08 14,790.95 13,838.90
Consumed
Purchase Of Stock-In 3,444.33 3,836.33 2,978.69
Trade
Changes In Inventories 356.98 -299.74 -1,208.63
Of FG, WIP And Stock-
In Trade
Employee Benefit 1,747.89 1,513.89 1,310.14
Expenses
Finance Costs 115.42 93.06 70.25
Depreciation And 734.49 755.83 721.56
Amortisation Expenses
Other Expenses 4,852.45 4,416.49 3,681.62
Total Expenses 24,669.64 25,106.81 21,392.53

Mar-24 Mar-23 Mar-22

Profit/Loss Before 7,005.04 5,489.60 4,247.87

Exceptional,
Extraordinary Items
And Tax
Exceptional Items 0 0 -53.73
Profit/Loss Before Tax 7,005.04 5,489.60 4,194.14
Tax Expenses-Continued Operations
Current Tax 1,729.88 1,418.38 1,107.29
Deferred Tax 5.33 -34.9 -51.02
Tax For Earlier Years -51.72 5.94 3.16
Total Tax Expenses 1,683.49 1,389.42 1,059.43
Profit/Loss After Tax 5,321.55 4,100.18 3,134.71
And Before
Extraordinary Items
Profit/Loss From 5,321.55 4,100.18 3,134.71
Continuing Operations
Profit/Loss For The 5,321.55 4,100.18 3,134.71
Period

Mar-24 Mar-23 Mar-22

OTHER ADDITIONAL INFORMATION

EARNINGS PER SHARE
Basic EPS (Rs.) 55.5 42.76 32.68
Diluted EPS (Rs.) 55.49 42.76 32.68
VALUE OF IMPORTED AND INDIGENOUS
RAW MATERIALS
FINANCIAL RATIOS

Mar '24 Mar '23 Mar '22

Investment Valuation Ratios

Face Value 1 1 1
Dividend Per Share 33.3 25.65 19.15
Operating Profit Per Share (Rs) 73.29 60.68 47.83

Net Operating Profit Per Share 321.62 313.58 262.6

(Rs)
Free Reserves Per Share (Rs) -- -- --

Bonus in Equity Capital 97.98 97.98 97.98

Profitability Ratios
Operating Profit Margin(%) 22.78 19.35 18.21

Profit Before Interest And Tax 19.87 16.55 15.07

Margin(%)
Gross Profit Margin(%) 20.4 16.83 15.34

Cash Profit Margin(%) 19.11 15.87 15.24

Adjusted Cash Margin(%) 19.11 15.87 15.24

Net Profit Margin(%) 17.24 13.63 12.44

Adjusted Net Profit Margin(%) 16.8 13.4 12.22

Return On Capital Employed(%) 38.53 35.7 32.3

Return On Net Worth(%) 28.88 26.3 23.48

Adjusted Return on Net 28.88 26.3 23.88

Worth(%)
Return on Assets Excluding 192.09 162.49 139.17
Revaluations

Return on Assets Including 192.09 162.49 139.17

Revaluations

Return on Long Term Funds(%) 38.57 35.7 32.3

Liquidity And Solvency Ratios

Current Ratio 1.64 1.74 1.73

Quick Ratio 0.97 0.97 0.92
Debt Equity Ratio -- -- --
Long Term Debt Equity Ratio -- -- --

Debt Coverage Ratios

Interest Cover 61.69 59.99 61.47
Financial Charges Coverage 68.06 68.11 71.74
Ratio
Financial Charges Coverage 53.47 53.18 55.89
Ratio Post Tax

Management Efficiency Ratios

Inventory Turnover Ratio 6.08 5.65 4.77

Debtors Turnover Ratio 8.7 9.43 10.66

Investments Turnover Ratio 1.67 1.92 1.88

 Fixed Assets Turnover Ratio 3.54 3.95 3.58

Total Assets Turnover Ratio 1.68 1.93 1.9

Asset Turnover Ratio 1.81 2.07 1.98

Average Raw Material Holding -- -- --

Average Finished Goods Held -- -- --

Number of Days In Working 20.59 29.46 31.35

Capital
Profit & Loss Account Ratios

Material Cost Composition 54.89 62.19 67.03

Imported Composition of Raw -- -- --

Materials Consumed

Selling Distribution Cost 3.75 3.36 3.19

Composition
Expenses as Composition of 0.59 0.62 0.73
Total Sales

Cash Flow Indicator Ratios

Dividend Payout Ratio Net Profit 47.58 46.55 55.53

Dividend Payout Ratio Cash 41.81 39.3 45.14

Profit
Earning Retention Ratio 52.42 53.45 45.4

Cash Earning Retention Ratio 58.19 60.7 55.48

Adjusted Cash Flow Times 0.01 0.01 0

ASIAN PAINTS Income Statement Analysis

▪ Operating income during the year fell 10.5% on a year-on-year (YoY) basis.

▪ The company's operating profit increased by 11.5% YoY during the fiscal. Operating
profit margins witnessed a fall and down at 22.8% in FY24 as against 18.3% in
FY23.

▪ Depreciation charges decreased by 14.4% and finance costs decreased by 20.1%

YoY, respectively.

▪ Other income grew by 113.4% YoY.

▪ Net profit for the year grew by 26.8% YoY.

 ▪ Net profit margins during the year grew from 12.2% in FY23 to 17.2% in FY24.

ASIAN PAINTS Balance Sheet Analysis

▪ The company's current liabilities during FY24 down at Rs 62 billion as compared to
Rs 79 billion in FY23, thereby witnessing an decrease of -21.2%.

▪ Long-term debt down at Rs 356 million as compared to Rs 762 million during FY23, a
fall of 53.3%.

▪ Current assets fell 12% and stood at Rs 146 billion, while fixed assets rose 24% and
stood at Rs 114 billion in FY24.

▪ Overall, the total assets and liabilities for FY24 stood at Rs 260 billion as against Rs
258 billion during FY23, thereby witnessing a growth of 1%.

What does the Key Ratio analysis of ASIAN PAINTS reveal?

Be it the company's profitability, operations effectiveness or utilization of funds, ratio analysis is

an important tool which helps in making investment decisions.

The ratio/financial analysis of ASIAN PAINTS reveals:

▪ Operating profit margins witnessed a fall and down at 22.8% in FY24 as against 18.3% in
FY23.

▪ Net profit margins grew from 12.2% in FY23 to 17.2% in FY24.

▪ Debt to Equity ratio for FY24 stood at 0.0 as compared to 0.0 in FY23

Current Valuations for ASIAN PAINTS

▪ The trailing twelve-month earnings per share (EPS) of the company stands at Rs
55.5, an improvement from the EPS of Rs 43.7 recorded last year.

▪ The price to earnings (P/E) ratio, at the current price of Rs 2,886.1, stands at 51.0
times its trailing twelve months earnings.
 ▪ The price to book value (P/BV) ratio at current price levels stands at 15.1 times, while
the price to sales ratio stands at 9.0 times.
▪ The company's price to cash flow (P/CF) ratio stood at 49.7 times its end-of-year
operating cash flow earnings.

Asset Turnover Ratio

SUMMARY

Revenue from Operations (in Crs.)

34,489 35,495 1.4

1.3 2x
29,1
01 4x 1.2
21,7
13 7x
1.1
9x

Mar-21 Mar-22 Mar-23 Mar-24

Mar-21 Mar-22 Mar-23 Mar-
24
Net Profit (in Crores) Return on Equity
5,460 32.0
27.9 28.1 1%
4,1 6% 23.1 5%
06 8%
3,1 3,0
39 31

Mar-21 Mar-22 Mar-23 Mar-24 43.

33. 7
32.
4 2
Earnings Per Share (in Rs.)

57.9
Mar-21 Mar-22 Mar-23 Mar-24
Mar-21 Mar-22 Mar-23 Mar-24

Return on Capital Employed

35.6%
31.6 32.5
% 27.8 %
%

Mar-21 Mar-22 Mar-23 Mar-24

 DuPont Analysis – Return on Equity and Return on Assets
(in Crores)
Return on Equity (ROE)
Mar-21 Mar-22 Mar-23 Mar-24
Net Profit ₹ 3,207 ₹ 3,085 ₹ 4,195 ₹ 5,558
Average Shareholders Equity ₹ 11,468 ₹ 13,309 ₹ 14,902 ₹ 17,360
Return on Equity (ROE) 27.96% 23.18% 28.15% 32.01%

ROE - DUPONT EQUATION

Mar-21 Mar-22 Mar-23 Mar-24
Net Profit ₹ 3,207 ₹ 3,085 ₹ 4,195 ₹ 5,558
Revenue ₹ 21,713 ₹ 29,101 ₹ 34,489 ₹ 35,495
Net Profit Margin (A) 14.77% 10.60% 12.16% 15.66%

Revenue ₹ 21,713 ₹ 29,101 ₹ 34,489 ₹ 35,495

Average Total Assets ₹ 18,247 ₹ 21,657 ₹ 24,369 ₹ 27,840
Asset Turnover Ratio (B) 1.19x 1.34x 1.42x 1.27x

Average Total Assets ₹ 18,247 ₹ 21,657 ₹ 24,369 ₹ 27,840

Average Shareholders Equity ₹ 11,468 ₹ 13,309 ₹ 14,902 ₹ 17,360
Financial Leverage (C) 1.59x 1.63x 1.64x 1.60x

Return on Equity (A*B*C) 27.96% 23.18% 28.15% 32.01%

Return on Assets (ROA)

Mar-21 Mar-22 Mar-23 Mar-24
Net Profit ₹ 3,207 ₹ 3,085 ₹ 4,195 ₹ 5,558
Average Total Assets ₹ 18,247 ₹ 21,657 ₹ 24,369 ₹ 27,840
Return on Assets (ROA) 17.57% 14.24% 17.22% 19.96%

ROA - DUPONT EQUATION

Mar-21 Mar-22 Mar-23 Mar-24
Net Profit ₹ 3,207 ₹ 3,085 ₹ 4,195 ₹ 5,558
Average Total Assets ₹ 21,713 ₹ 29,101 ₹ 34,489 ₹ 35,495
Net profit Margin (A) 14.77% 10.60% 12.16% 15.66%

Revenue ₹ 21,713 ₹ 29,101 ₹ 34,489 ₹ 35,495

Average Total Assets ₹ 18,247 ₹ 21,657 ₹ 24,369 ₹ 27,840
Asset Turnover Ratio (B) 1.19x 1.34x 1.42x 1.27x

Return on Assets (A*B) 17.57% 14.24% 17.22% 19.96%

DuPont Summary:
➢ The Company’s ROE saw a decrease from 27.96% to 23.18% in FY22 due fall in net profit margin.
➢ In FY23 & FY24, the company is back to its net profit margin which has improved its return on equity.
➢ The company assets have grown by 13.7% in the last 3 years and sales growth is nearly 18%, which has resulted
in increasing return on assets. The company has announced a capex of INR 8,750 crores for the next three years.
SUGGESTIONS

Asian Paint Limited is a growing company and the overall performance of the company is
satisfactory. The main performance of the company can be judged by the Net profit ratio and it has
increased year by year. The Expenses have decreased, so the company can get more profit and
can also give more dividends to the shareholders.

• They should promote Vendors in supplying the raw Materials Rather than Importing.
• They should develop suppliers to supply basic ingredients for paints (phthalic anhydride,
Resins).
• During the Monsoon Seasons they should increase Exports to More countries (Already
Captured exporting to 22 markets- Asia Pacific, Middle East, Africa). In addition, should
offer Seasonal Products E.g. Diwali in the North, Pongal in the south & Christmas.
• They should increase promotional activities about regional festivals.
• They should offer other variety of products ( Wood Polishes)at a discounted rate during
sale of Decorative paints-predator pricing Industrial paints and should tie up with
Business units for longer periods or can take over of small companies to increase their
market Share.
• They should refinish their old Capital equipment/metals with paints for industries at low
rates to prevent Corrosion.
• And the dealers of the company are not satisfied with the price so they should also get
price relaxation.
 CONCLUSION
From the above financial project report what can be concluded is that the Asian paints industry is
the largest paint company providing customers with all kinds of products they want. It is the
leading firm in this industry. The company has expanded its business in different segments.
Asian Paint operates in 21 countries and has 29 manufacturing units in the world servicing
consumers in over 65 countries. The company’s financial position is also good, and they have a
brand position in the market. The profit of the firm has been increasing year by year.

Asian Paints has sold its loss-making units in China, Hong Kong, Malaysia and Thailand. This
will remove the dampening effects these units have on their profitability. Asian Paints is looking
at an upswing in consumer demand and a strong recovery in the real estate, construction &
automotive industries. The demand for the decorative paints segment (75% of the paint industry)
will be spearheaded by the demand from the growing real estate industry. Asian Paints is the market
leader in the decorative paints segment. Currently, per capita paint consumption in India is at 0.5-
0.75 kg which is very low compared to developed countries' average of 22kg. This shows a huge
potential ahead for Indian paint companies and especially for Asian Paints.

The company is also focusing aggressively on the industrial paints segment where it is currently
in the 2nd position. The demand for industrial paints is expected to rise with the growing demand
from the automotive sector and other industries

Asian Paints is India’s largest paint company having a Strong Brand & Huge Distribution
network. It has a sound financial past & is expected to have robust growth, both in the short-term
and long-term.
BIBLIOGRAPHY

➢ For introduction of Asian Paints ltd: www.asianpaints.com

➢ For introduction of FMCG industry analysis:

http://www.economywatch.com/world-industries/fmcg.html

➢ For annual reports of the company:

www.asianpaints.com

➢ For economy analysis:

www.slideshare.net

➢ Ratio analysis: Management Accounting (5th edition)