Betting on Akzo Nobel among paint stocks: Mehraboon Irani, Nirmal Bang Securities

In a chat with ET Now, Mehraboon Irani, Principal & Head-Private Client Group Business of Nirmal Bang Securities, shares his views on paint stocks. Excerpts:

ET Now: When it comes to paint companies, the big four apart from Asian Paints, Kansai Nerolac, Berger and Akzo Nobel are roughly trading at their 52-week highs. Some have exposure purely on the residential and commercial side, some also have exposure to the auto industry, which is also on a rebound now. Any opinion on those?

Mehraboon Irani: The best stock in the space which we had given a coverage at around RS 850-900 is Akzo Nobel. It has attained our target, but we are taking a fresh look at this particular stock because if you look back at the company's operating margins vis-à-vis others, it is still the lowest and there is a slight improvement in the operating margin.

The stock, for all you know, could command a valuation better than what it is commanding today and we could even see a 1600-1700 coming for the stock in the next couple of quarters. Being at MNC, the comfort level is very high. I would advise investors to continue to stick to this because if we have decent numbers coming on the operating level over the next two quarters, the stock could give another 15 to 20 per cent from here.