BlogsA viewpoint on the fundamentals of Asian Paints
Investing
Jan 11, 2025
A viewpoint on the fundamentals of Asian Paints

None of the articles/discussions in the Investing section is an investment advice. Please do your own analysis or consult a SEBI-registered investment advisor for advice on investing in stock markets/equities. The purpose of each of these articles is to encourage constructive discussions,  and thus, discover new opinions, perspectives, facts, figures and insights about companies and industries.

So, here we go: Fundamentally, Asian Paints looks weak for a Paints only play. 

Asian Paints' competitive advantages were it's distribution and brand:

  1. Distribution: completely disrupted with Birla, JSW, Pidilite entering the space. They have a better/larger if not comparable distribution capability,  through their adjacent businesses - Ultratech, JSW Steel, Fevicol/Adhesives etc whose TG is also the construction, real estate and infra industries. Not just that, their distributors can bundle products, offer more discounts on bundled offerings. For instance, steel, adhesives/construction chemicals, cement and Paints to a developer. I believe it is only a matter of time before Adani enters the space. It is absolutely natural for the group given the adjacencies they are in.
  2. Brand - Birla, JSW are more deep pocketed than Asian Paints. If Adani enters, he will go for 1/2nd position anyway. These guys are/will be all in on brand building and for a sustained period.
    So, until and unless Asian Paints leverages its massive distribution to launch more products, its fortress (moat) is breached so to say.

What do you think? 

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Jan 11, 2025

I am bullish on Vodafone. I see it as a turnaround case. The thesis is:

  • the telco market is too big for a duopoly. Even the smallest GCC/European countries have two or more players.
  • Promoters have deep pockets and now, one of the promoter is Government with nearly a third of the company. So, essentially you and I may have to bail out with your taxes should things go bad from here. 😅
  • The intent seems clear - they are monetizing non core assets, investing in core business and holding on to/regaining market share in their p0 markets without worrying about p1/p2s. 

How much they will turnaround will be seen, but I think they do have a strong case. Do you agree?