Marico share price jumped over 6% in early trade on Tuesday after the Parachute hair oil maker reported strong Q2 results, with volume-led growth and robust margin expansion. Marico share price rallied as much as 6.34% to Rs 848.50 apiece on the BSE.
Marico reported a 31% year-on-year (YoY) rise in its consolidated net profit to Rs 550 crore for the second quarter of FY27. The company's revenue from operations in Q2FY27 rose 13% YoY to Rs 3,897 crore.
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Operating performance improved as earnings before interest, taxes, depreciation and amortisation (EBITDA) during the September quarter increased 26.6% YoY to Rs 709 crore, while EBITDA margin expanded by 200 basis points to 18.2%.
The company reported a volume growth of 10%, in line with estimates. Its Parachute volumes grew 13% YoY – highest in 22 quarters, while VAHO posted sixth consecutive quarter of strong growth, rising 21% YoY.
ALSO READ: Marico Q2 Review: Firing On All Cylinders; HDFC Securities Upgrades Rating; Check New Target Price
Marico also raised its FY27 revenue and EBITDA growth guidance to teens and mid-twenties from double-digit/high-teens earlier. India volume growth guidance has been raised to double-digit from high single-digit.
Should you buy, sell or hold Marico shares after Q2 results?
Brokerages remain bullish on Marico, citing strong earnings outlook and strengthening growth visibility.
JPMorgan maintained an ‘Overweight' rating on Marico and raised target price to Rs 940 from Rs 915 earlier. It noted that lower copra costs, premiumisation and scaling digital brands support profitability of the company.
Goldman Sachs said Parachute volume growth and premium portfolio expansion strengthen medium-term growth visibility. Additionally, lower copra costs, improving digital and foods profitability and operating efficiencies support margins
It maintained a ‘Buy' call, with Marico target price of Rs 950 apiece.
Motilal Oswal Financial Services largely maintained its EBITDA estimates for FY27 and FY28. It models a CAGR of 12% in revenue and 18% in EBITDA over FY26-29E.
The brokerage firm noted that Marico has sustained its growth trajectory and is diversifying revenue streams with a strong focus on TAM expansion. It reiterated its ‘Buy' rating on the stock with a target price of Rs 975 apiece (based on 45x Sep'28E EPS).
Marico remains one of Motilal Oswal's top picks in our coverage universe.
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Elara Securities raised earnings estimates by 3.7%, 5.0% and 5% for FY27E, FY28E and FY29E, respectively, given excellent execution and confidence in scaling up the digital first and foods businesses with margin improvement.
Given the recent 10% correction in the stock, the brokerage firm upgraded Marico shares to Buy from Accumulate, and raised the target price to Rs 1,000 from Rs 970, on 50x (unchanged) March 2028E P/E
Nirmal Bang values Marico stock at 47x Sep-28E EPS, inline with its 5-year average P/E of 47.7x. It upgraded the stock to ‘Buy' from ‘Hold, and raised the target price to Rs 970 from Rs 895 earlier.
At 9:30 AM, Marico share price was trading 5.92% higher at Rs 845.10 apiece on the BSE.
Disclaimer: The views and opinions expressed by the investment advisers on NDTV Profit are of their own and not of NDTV Profit. NDTV Profit advises users to consult with their own financial or investment adviser before taking any investment decision.
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