Dulux has benefited from 2 major tailwinds in the past few...

Dulux has benefited from 2 major tailwinds in the past few years:

1) The residential construction boom in NSW and Victoria.
2) The fall in raw material prices, titanium dioxide and petroleum based products.

With residential construction slowing down and raw materials already fallen by 50% over the past 5 years, these events are unlikely to continue providing a tailwind to Dulux's earnings in the near future. Wattyl hasn't really been a major competitor to Dulux after Bunnings dumped it in 2009 so I don't expect the demise of Masters to have a big impact on Dulux's earnings. I read Dulux already sells 2 out of every 3 cans of paint in the retail segment.

It's operating margins of 17% (paint & coating) is already world class so hard to see the new factory improving that much further.

I think at current prices, it is priced to perfection and any hiccup will be disastrous on the SP.

Good luck to all.
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