Buy Pidilite Industries; target of Rs 854: Edelweiss

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26 Aug, 2025 12:21

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Edelweiss' research report on Pidilite Industries

Pidilite Industries’ (PIDI) Q4FY17 consolidated revenue (up 4.9% YoY) and PAT (down 8.2% YoY) came in line, while EBITDA (up 8.3% YoY) marginally surpassed estimates. Domestic volume and mix grew 7.8% YoY, reflecting pick up post demonetisation. Consolidated gross margin plummeted 209bps YoY on raw material cost pressure.

Outlook

Good performance of acquisitions (Bluecoat, Nina, ICA, etc) and entry in new markets & adjacent categories will boost growth. PIDI will benefit due to lower tax rate on adhesives in GST and shift of business from unorganised to organised players. At CMP, the stock is trading at P/E of 32.9x FY18E. We maintain ‘BUY/SO’ with TP of INR 854.

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