Geojit Financial Services research report on Grasim Industries
Grasim Industries Ltd, a subsidiary of Aditya Birla Group, is a diversified company with interests in cement, textiles, retail and chemicals. It is also the world’s largest producer and exporter of viscose rayon fibre. In Q1FY25, consolidated revenue increased 9.0% YoY to Rs. 33,861cr, aided by steady growth in the building materials, cellulosic staple fibre and financial services businesses. EBITDA declined 4.4% YoY to Rs. 4,760cr and margin contracted to 14.1%, led by building materials segment with lower price realisation in cement coupled with investments in paints business. Grasim is poised for robust growth, fueled by government initiatives, improved demand for viscose staple fibre, favourable cement outlook, improved traction in Birla Pivot and increased production capacity in the paints decorative segment.
Outlook
We are optimistic about its long-term growth and reiterate our BUY rating with a revised target price of Rs. 3,058 based on the sum-of-the-parts (SOTP) valuation.
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