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Asian Paints shares fall 3.5% on CLSA downgrade, fire at Vishakhapatnam facility

BusinessToday.In     April 9, 2019

Shares of Asian Paints tumbled nearly 4 per cent in intra-day trade on Tuesday after the company reported that a fire broke out in Andhra Pradesh manufacturing facility yesterday.

The company made this announcement after trading hours on Monday.

Reacting to the news, the shares opened 26.4 points below yesterday's close and fell as much as 3.8 per cent to touch an intraday low of Rs 1,439.70 on BSE. On NSE, the stock fell almost 4 per cent to day's low at Rs 1,437.20.

"The fire has been brought under control. The company is in the process of assessing the extent of the damage. The manufacturing operations of the plant have been affected. This will not have any impact on the business operations of the company," Asian Paints said in a filing to BSE

In a separate development, global brokerage CLSA downgraded the paint company to 'sell' from 'outperform' and reduced its target price to Rs 1,400 from Rs 1,565. The global investment bank has also slashed EPS estimates by 2-5 percent led by revenue cuts.

The stocks of the company has lost 4.95 per cent in the last three trading sessions.

The share price of the paint company has moved below its 30-day simple moving average today.

According to data available with exchange, there was surge in volume trade with 5.45 lakh shares and 26.42 lakh shares changing hands on BSE and NSE, respectively.

Meanwhile, Asian Paints shares closed trade at Rs 1,443.50, down 3.54 per cent, on the BSE.

(Edited by Rupa Burman Roy)

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