Balkrishna Industries Gets 'Buy' Upgrade From Nomura As Q3 Results In Line With Estimates

Balkrishna Industries Ltd. has been upgraded to a 'buy' rating by Nomura, as it has a positive outlook on the company's future growth. The brokerage has set a target price of Rs 3,242, implying an upside of around 26.4% from the stock’s current price of Rs 2,565.

The company’s third-quarter results for FY25 were in line with Nomura's expectations. BIL reported a year-on-year revenue growth of 11%, amounting to Rs 2,570 crore.

The company’s focus remains on expanding its presence in key markets such as India and the US, with plans for a stronger push in the US starting in fiscal 2026. Additionally, BIL has seen strong growth in other regions like Africa and the Middle East, helping to diversify its revenue base, Nomura noted.

The company is poised to benefit from a recovery in agricultural commodity prices, which could boost replacement demand for its products, the research firm highlighted. "Based on our analysis, agri commodity prices seem to have bottomed out and have started inching upwards, which should support replacement demand."

The tire manufacturer has also gained market share in other regions and is expanding its capabilities in the off-the-road segment. "BIL is a structural play on steady market share gains in the global OHT tyre segment," it said.

The company is investing heavily in new OTR capacities, with plans for increased production in the US in FY26.

Looking ahead, Nomura projects a steady recovery for BIL, with a volume growth forecast of 9% in FY25, followed by 8% and 10% in FY26 and FY27, respectively. The brokerage expects BIL to maintain Ebitda margins of 25.5-26.5% over the next few years, supported by favourable market conditions.