Motilal Oswal's research report on Pidilite Industries
Pidilite Industries (PIDI) reported consolidated revenue growth of 8% YoY in 3QFY25, with underlying volume growth of 10% (est. 9%). The consumer business witnessed value and volume growth of 5% and 7% YoY, reflecting a similar trend in 9MFY25. B2B business reported 19% and 22% value and volume growth. The impact of price cuts is diminishing, with the value and volume gap narrowing to 200bp vs. >400bp in 1HFY25. Demand has shown some softness, particularly in the urban market. Rural growth continues to outperform urban growth. We model a 9% volume growth in FY25E and ~7%/13% revenue growth in FY25E/FY26E.
Outlook
We believe the current valuation limits the upside potential. We reiterate our Neutral rating on the stock with a TP of INR3,200 (premised on 60x Dec’26E EPS).
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