Grasim Industries Ltd.'s June-quarter performance prompted brokerages to raise target prices while maintaining buy or overweight ratings. Analysts pointed to the rebound in viscose staple fibre and chemicals, the scale-up of paints and Birla Pivot, and an improving profile.
Brokerages lifted their target prices for Grasim Industries after its Q1 results, citing strong growth in chemicals, paints and new businesses, while also flagging some risks.
Grasim reported a standalone net profit of Rs 247 crore for the first quarter of FY27, compared with a loss of Rs 118 crore a year earlier, as revenue and operating profit increased during the quarter.
Revenue from operations rose 27.9% year-on-year to Rs 11,795 crore from Rs 9,223 crore. The company said standalone revenue reached an all-time high during the quarter, supported by its core and growth businesses. Here's what the brokerages are saying:
Jefferies
Jefferies maintained Buy and raised its target price to Rs 3,910 from Rs 3,600, implying 18.5% upside from the market price of Rs 3,300. The brokerage said Grasim delivered a sharp Q1 beat, with all segments outperforming. Viscose staple fibre and chemicals rebounded on pricing tailwinds, while new businesses scaled.
Jefferies said paints is guiding for 50% year-on-year growth in FY27, with FY28 targets intact. B2B e-commerce is set to turn profitable by FY27-end. It believes a stronger standalone profile will narrow Grasim's holding-company discount and reiterated the stock as a top pick.
Morgan Stanley
Morgan Stanley maintained Overweight and raised its target price to Rs 4,000 from Rs 3,900, implying 21.2% upside. The brokerage said the quarter was strong, with the Ebitda beat led by chemicals and paints. Birla Pivot and paints continued to ramp up quickly. Morgan Stanley sees a case for re-rating over the next 12 months and compounding over the medium term with continued execution. Grasim remains its top pick.
Citi
Citi maintained Buy and raised its target price to Rs 3,850 from Rs 3,600, implying 16.7% upside. The brokerage said Q1 was ahead but Q2 is likely to weaken. It highlighted paints market-share focus, limited funding for AB Renewables, and uncertainty around chemicals profitability amid the Middle East crisis.
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