Neutral Pidilite Industries; target of Rs 1550: Motilal Oswal

Neutral

Motilal Oswal's research report on Pidilite Industries

Pidilite Industries (PIDI) reported consolidated revenue growth of 10% YoY (in line) in 3QFY26. Standalone revenue grew 11% YoY, led by 9% underlying volume growth (UVG) (vs est. 12%). Ex-exports, growth was at ~12%, as exports declined 13% due to the US tariff impact. In the C&B business, value/volume growth stood at 12%/10% YoY, supported by mix and premiumization. The B2B segment saw 3% value growth and 7% volume growth, impacted by export headwinds, though domestic B2B grew in the mid-teens. The domestic business (C&B + B2B) delivered ~11% UVG. Price growth was driven by selective price laddering, premium mix, and tactical pricing in select categories, with management targeting a ~100–150bp price–volume gap on a sustained basis.

Outlook

We believe the current valuation limits the upside potential. As a result, we reiterate our Neutral rating on the stock with a TP of INR1,550 (premised on 50x Dec’27E EPS).

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