Doms New Product Launches Buoy Growth, Says PL Capital Post Inline Q1 Results , Maintaining 'Buy'
Doms' revenue growth is expected to be in the band of ~18-20% with an Ebitda margin of ~16.5%-17.5% in FY26E.
Doms' top line increased 26.4% YoY to Rs 5,623 million (our estimate: Rs 5,501 million). Stationery revenue increased 18.3% YoY to Rs 5,262 million, contributing 93.4% to the overall revenue, with an Ebitda margin of 19.2%.
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PL Capital Report
Doms Industries Ltd. reported an inline performance with revenues of Rs 5,623 million (our estimate: Rs 5,501 million) and Ebitda margin of 17.6% (our estimate: 17.3%) aided by healthy volume growth in stationary segment amid new product launches within categories like scholastic stationery, scholastic art material, paper stationery and office supplies.
Even hygiene business reported healthy revenues of Rs 360 million (our estimate Rs 250 million) with an Ebitda margin of 6.8% (our estimate: 0.5%).
The new development plan on 44-acres land parcel at Umbergaon is on track (Rs 700 million incurred towards capex in Q1 FY26) and commercial production is expected to begin by Q4 FY26E.
Aided by capacity expansion in core stationery business, widening product basket (SKU count is up by ~300 in last one year), and strengthening distribution network (retail touch points are up by ~20,000 in last one year) we expect sales/PAT CAGR of 24% over FY25-FY27E.
We broadly maintain our estimates and retain Buy on the stock with a target price of Rs 3,087 (60x FY27E EPS; no change in target multiple).
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