- JPMorgan remains overweight on Marico with a Rs 915 target price and 16% upside
- Marico Q2 revenue likely to grow in double digits amid resilient domestic demand
- International business growth driven by Vietnam, South Africa, and Middle East markets
Marico Ltd. has JPMorgan bullish on its second quarter progress, and the brokerage remained 'overweight' on the stock with a target price of Rs 915. The TP implies a nearly 16% upside to its last closing price.
"We stay OW on the stock and believe it is amongst the best-placed saples names to own on the back of high single-digit domestic volume growth, successful portifolio diversification and focused intervention or investments towards the core portfolio improving the margin trajectory," the brokerage said.
The company said in a regulatory filing that its domestic demand remained resilient, while operating operating environment stayed volatile in the second quarter. Despite that, it remains optimistic on consumption trends.
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The second quarter revenue is likely to grow in double digits, with the international business delivering robust numbers. Constant currency (CC) growth was in teens led by Vietnam, South Africa and the Middle East business.
Parachute oil sustained strong performance in as of Sept. 30, 2026, Saffola delivered mid-single digit growth during the quarter. Volume registered a double digit growth, while operating profit was seen growing in mid-20s. Marico expects to surpass near-term estimates across financial parameters
"Following a strong 2Q performance, we expect upward revisions to FY27 EPS Estimates as MRCO expects to surpass its near-terms guidance," JPMorgan stated, adding that the growth will be aided by core franchises and the scale-up of new growth busınesses.
The brokerage noted that the FMCG major's CNO portfolio will likely benefit from volume improvement and strengthening of competitive positioning. Additionally, VAHO and Saffola edible oils should also see improving revenue growth trends.
"Management's guidance for a doubling of revenue for Foods & Digital First brands over the next three years will likely support investor confidence, though proof of execution will be monitored closely. Gradual margin expansion should be aided by operating leverage, improving profitability of the Foods & Digital First portfolio, an improving mix, and sustained cost focus. We rate the stock OW," JPMorgan stated.
Marico Q1 FY27 Recap
Marico reported a stronger-than-expected performance for the June quarter, with net profit rising 25% year-on-year to Rs 630 crore, driven by healthy volume growth across its India business, resilient international demand and improved operating margins.
The FMCG major's consolidated revenue rose 22.9% to Rs 3,957 crore during the quarter, nearing the Rs 4,000-crore mark, while EBITDA increased 25% to Rs 819 crore. EBITDA margin expanded to 20.7% from 20.3% a year earlier.
The company outperformed Bloomberg consensus estimates across key parameters. Analysts had expected net profit of Rs 581 crore, revenue of Rs 3,940 crore, EBITDA of Rs 762 crore and an EBITDA margin of 19.4%.
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