Midwest shares rise 5% as Motilal Oswal gives 'Buy' rating, brokerage sees up to 23% upside

Stock rises in trade. 

Midwest shares rose in Friday’s trade after domestic brokerage Motilal Oswal initiated coverage on the stock with a ‘Buy’ rating. Intraday, the stock rose 5 percent to Rs 1,701.10 per share.

The brokerage has set a price target of Rs 2,000 per share, implying an upside of about 23 percent from the previous closing price of Rs 1,625.40.

Midwest is India’s largest producer and exporter of premium Black Galaxy granite. The company is vertically integrated across the granite supply chain and operates 20 mines. It reported revenue of about Rs 6.3 billion in FY25, recording a compound annual growth rate (CAGR) of over 21 percent over the past five years.

The brokerage noted that Midwest has an EBITDA margin of 27.4 percent, with a CAGR of more than 44 percent during the same period, higher than industry peers.

It expects the company’s overall revenue and EBITDA to post a CAGR of 36 percent and 47 percent, respectively, over FY25–28, supported by the Quartz and HMS businesses. Adjusted profit after tax is seen growing at a CAGR of 56 percent over the same period.

Midwest’s net debt stood at Rs 2.2 billion as of FY25, translating into a net debt-to-EBITDA ratio of 1.3 times. The brokerage expects the ratio to fall below 1 time on the back of rising operating profit.

Motilal Oswal said it values the company at 13 times FY28 estimated EV/EBITDA to arrive at the target price of Rs 2,000. The stock has gained 48 percent since its listing in October 2024.

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