As Marico's quarterly results came in-line with expectations, brokerages cheered the double-digit revenue guidance and margin expansion plans, raising their targets on the player.
Marico reported consolidated net profit of Rs 464 crore for the June quarter of FY25, registering a growth of 9 percent from Rs 427 crore in the same quarter of the previous financial year.
The total revenue of the company is Rs 2,643 crore, an increase of 6.7 percent from Rs 2,477 crore in the year-ago quarter, the company said in a regulatory filing.
Domestic value and volumes rose seven percent and four percent each YoY aided by price hikes in Coconut Oil. In the medium term, the company aims to deliver double-digit revenue growth and double-digit constant currency growth in the International business.
Marico expects operating margin to inch up over the next few years across
both the India and international businesses. Additionally, the FMCG player also expects to aggressively diversify the portfolio through the scale up of Foods and Premium Personal Care portfolios.
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International brokerage firm Jefferies bumped up its target price on Marico from Rs 650 per share to Rs 780, as the FMCG player is seeing improving growth trends and has a positive outlook.
The growth outlook remains positive, as pricing growth turned positive after two years and margins were protected despite of copra inflation.
Goldman Sachs also raised its target price on the Parachute Oil promoter to Rs 715 per share, as volume growth improved despite a correction in distributor inventory. As the pricing strategy improved, so did revenue growth.
Given market share gains and pricing power in the key franchise, we are raising FY26E EPS by 4 percent, said Nuvama Institutional Equities. The brokerage also raised its target price on Marico to Rs 780 (earlier Rs 640) while retaining its buy call.
All brokerages flagged that the ongoing situation in Bangladesh remains a concern and needs to be closely monitored.
Over the past year, Marico shares have gained around 16 percent, as compared to a 22 percent hike in the Nifty 50 index.
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