Buy Marico; target of Rs 645: Sharekhan

Sharekhan is bullish on Marico has recommended buy rating on the stock with a target price of Rs 645 in its research report dated January 05, 2023.

Broker Research

January 13, 2023 / 10:55 IST

Sharekhan's research report on Marico

Q3FY2023 business update gives us a glimpse of sequential improvement in the operating performance, led by recovery in volume growth and margin improvement on a q-o-q and y-o-y basis. Steady growth in the premium and urban categories and likely recovery in rural demand will improve the growth trajectory in the coming quarters. Management has maintained its aspiration of achieving volume-led profitable growth over the next two to three years. Scale-up in the food business (Rs. 650 crore in FY2023 and Rs. 850-1,000 crore in FY2024) and personal care category (Rs. 450-500 crore by FY2024) will further add-on to revenue and EBIDTA going ahead.

Outlook

We reiterate Buy on Marico with an unchanged PT of Rs. 645. Stock trades at 39.2x/34.5x its FY2024/25E earnings (at discount to five years average multiple). Attractive valuations and better growth visibility compared to close peers make it a better pick in the mid-to-large consumer goods companies.

For all recommendations report, click here