UBS, Morgan Stanley Maintain Bearish Stance On Dabur After Muted Q2 Outlook

Brokerages UBS and Morgan Stanley have maintained cautious views on Dabur India Ltd. following its Q2 FY26 business update, citing subdued revenue growth and continued pressure in key segments. While UBS finds the performance broadly in line when adjusted for GST-related disruptions, Morgan Stanley flagged the results as weaker than expected, highlighting a miss on its revenue estimates.

In Dabur's Q2 business update the company said, Q2 consolidated revenue will likely grow in mid-single digits and consolidated profit to grow almost in line with revenue.

The company also said that consumption is expected to strengthen with macroeconomic conditions and GST Cuts. The company also anticipates revenue growth to regain momentum in coming quarters.

 The Q2 update comes after Dabur posted a modest 3% year-on-year rise in net profit for Q1 FY26,reaching Rs 514 crore. Revenue for the June quarter rose 1.7% to Rs 3,404.58 crore, while EBITDA grew 2% to Rs 667.82 crore. Margins remained flat at 19.6%, in line with Bloomberg estimates.

UBS has maintained a “Sell” rating on Dabur with a target price of Rs 500. It noted that while Q2 revenue growth was in line after adjusting for GST impact, the beverages segment continues to struggle and international business has slowed. The brokerage sees these trends as concerning for future growth.

Morgan Stanley, meanwhile, reiterated its “Underweight” stance with a lower target price of Rs 400. It said Dabur's Q2 consolidated revenue growth fell short of its 7% estimate, indicating weaker-than-expected performance.

Dabur India, a leading FMCG player, operates across categories including health supplements, personal care, home care, and packaged foods. With a strong rural footprint and growing international presence, the company remains a key player in India's consumer goods landscape, though near-term headwinds persist.