Kansai Nerolac Paints Limited Intrinsic Value
KANSAINER · Consumer Durables · Current price ₹185
Is Kansai Nerolac Paints Limited undervalued?
We estimate the fair value of Kansai Nerolac Paints Limited at ₹71 per share, against a market price of ₹189. That puts the share price about -62.4% above our estimate, at medium confidence. This is our view of what the business is worth, not a target price or a forecast of where the share price will go.
How this fair value is calculated
This estimate comes from 2 methods: Discounted cash flow (2-stage) (₹74), PEG (growth-implied P/E) (₹53). Each is weighted by how well its inputs held up for this company. The full working, including the assumptions and what data was missing, is set out below.
The range around this estimate
Our estimate for Kansai Nerolac Paints Limited spans ₹53 to ₹78. A margin of safety means buying meaningfully below the estimate: the wider the range, the more room the assumptions leave for error.
Margin of safety
Value investors look for a margin of safety: a discount to estimated value that absorbs being wrong. At ₹189 against an estimated value of ₹71, Kansai Nerolac Paints Limited trades at -62.4%, i.e. a premium to our estimate. How much margin to demand depends on how much you trust the inputs, which is what the confidence band below is for.
How we got this fair value
Every number below is part of the same estimate for Kansai Nerolac Paints Limited. Nothing here is a target price or a forecast of where the share price will go.
Workable, with real gaps. Weigh it alongside your own view rather than on its own.
Estimate range ₹53 – ₹78
Why this method for this business
Kansai Nerolac is an asset-light compounder in the paints industry, where earnings power and a durable moat are key. DCF and relative PE/PEG models are appropriate for assessing its intrinsic value and relative positioning.
The models behind the number
Each method is weighted by how well its inputs held up for this company.
Intrinsic value from 2-stage discounted cash flows (primary for asset-light / normal businesses); FCFE path
₹303 is a gross outlier vs the ₹74 model consensus (outside 0.33×–3×) — likely a data error / wrong model for this business
- Discounted cash flow (2-stage) is primary for asset-light businesses; relative PE/PEG are secondary for comparison and growth-implied valuation. Other models are not suitable for this business type.
What was missing
- Lack of forward EPS estimates for 2027
- Limited data on brand equity and moat strength
- Insufficient information on capital allocation efficiency
What drives it
15 inputs, grouped by how strong each claim is
- FCF_0 (normalized)
- 557 ₹cr
- Net debt
- 303 ₹cr
- Earnings growth
- 7.2% CAGR
- EPS (TTM)
- 7.42 ₹/share
fcf_norm (median ≤5y positive)
gross debt (cash n/a)
computed
computed
- Discount rate (r)
- 14.78%
- Beta
- 1.05
COE (building-block)
bottom-up industry
- Stage-1 start growth
- 5%
- Fade shape
- linear
- Terminal growth (g)
- 5%
- Stage-1 years
- 8 y
pat_cagr_5y
lifecycle Mature
macro terminal × quality premium
lifecycle Mature horizon
- Lifecycle stage
- Mature
- Quality premium
- 1×
forecast engine (L20)
moat None + capital allocation
- Path
- FCFE
- Terminal-value fraction
- 0.491
- Growth-implied P/E
- 7.2×
computed (D/E vs 0.8)
PV_TV / (PV_1+PV_TV)
min(growth, 30)
Who computed this
A language model (qwen3:8b) selects the valuation method and the judgement inputs for Kansai Nerolac Paints Limited: which models suit the business, the moat, the growth and margin assumptions. It does not produce the number. The fair value itself is computed in Python by a deterministic engine (version 2026.08.1) from those inputs, so the same inputs always give the same result and every figure above can be traced to a source.
Estimated 14 Sept 2026. Re-run as new financials and news arrive.
How we value stocks
We estimate what a business is worth from its own economics: cash flows, returns on capital, and a multiple justified by its quality, rather than from where the share price has been. A fair value estimate is a view, not a verdict, and it is only as good as the inputs listed above.
Read the full fair-value methodologyMore on Kansai Nerolac Paints Limited
DocStoX estimates are computed from reported financials, for informational purposes only, not investment advice. Consult a SEBI-registered advisor before investing.