Castrol Q1 Results Review: Downgraded To 'Hold' Rating As IDBI Capital Sees Limited Upside After Recent Rally

Strong free cash flow generation, minimal capital requirements, high ROEs and robust payouts make Castrol an attractive investment. However, rich valuations limit potential upside, so we await a better entry point in the stock..NDTV Profit’s special research section collates quality and in-depth equity and economy research reports from across India’s top brokerages, asset managers and research agencies. These reports offer NDTV Profit’s subscribers an opportunity to expand their understanding of companies, sectors and the economy..IDBI Capital Report.Castrol India Ltd.’s revenue and PAT was in-line with our expectations. Castrol’s topline increased by 7% YoY and by 5% QoQ to Rs 14.2 billion. Sales volume grew 8.6% YoY and 6.8% QoQ, driven by strong volume growth in the low priced premium portfolio. The Personal Mobility and CVs reported double digit volume growth in Q1 CY25. Ebitda increased by 5% YoY to Rs 3.1 billion, however the Ebitda margin contracted by 55bps YoY to 21.6% (down 615bps QoQ), primarily due to higher advertisement spends on Castrol active campaign. Management will be focusing on expanding the distribution network across rural and urban India. We value the stock at a PER of 20 times CY26E EPS to derive a target price of Rs 223 (Rs 219 earlier), and we downgrade our rating from Buy to Hold on the stock due to recent rally in the stock price limiting the upside..Click on the attachment to read the full report:.Bajaj Finance Q4 Results Review: Motilal Oswal Maintains 'Neutral' Stance, Sees Rich Valuations Limits Upside.DISCLAIMERThis report is authored by an external party. NDTV Profit does not vouch for the accuracy of its contents nor is responsible for them in any way. The contents of this section do not constitute investment advice. For that you must always consult an expert based on your individual needs. The views expressed in the report are that of the author entity and do not represent the views of NDTV Profit..Users have no license to copy, modify, or distribute the content without permission of the Original Owner.

Castrol Q1 Results Review: Downgraded To 'Hold' Rating As IDBI Capital Sees Limited Upside After Recent Rally

IDBI Capital downgrades its rating from Buy to Hold on Castrol India due to recent rally in the stock price limiting the upside

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