Hold Grindwell Norton; target of Rs 1739: Prabhudas Lilladher

Prabhudas Lilladher's research report on Grindwell Norton

Grindwell Norton (GWN) delivered a subdued performance for the quarter, with revenue remaining largely flat YoY at Rs7.0bn and EBITDA margin contracting by 40bps YoY to 18.5%. The Abrasives segment reported negligible growth, while margins weakened further—likely impacted by continued Chinese dumping. The Ceramics & Plastics (C&P) segment also posted a decline in revenue, with profitability remaining under strain. Notably, the Digital Services segment saw topline growth, however, it continued to witness a sharp erosion in margins. Meanwhile, the management has approved a land acquisition of ~Rs180mn in Halol, Gujarat, on a freehold basis to support future expansion plans following the ongoing capacity expansion of the Halol plant for performance ceramics and refractories business.

Outlook

The stock is trading at a P/E of 43.7x/37.6x on FY26/27E earnings. We maintain ‘HOLD’ rating with a TP of Rs1,739 (same as earlier) valuing the stock at a PE of 40x Mar’27E (same as earlier).