Jyothy Laboratories posted flat YoY sales growth in Q2 FY26, with volumes rising 3% (estimate: 4%; 1QFY26 4%). The difference between value and volume growth was primarily due to MRP reductions, higher grammage, and promotional price-offs in select categories. Jyothy Labs expects a 2%-2.5% value volume gap at the overall level going forward.
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Motilal Oswal Report
We cut our EPS estimates by 2%-3% each for FY26E-28E.
We believe that while H2 FY26 will be better than H1 FY26 for most FMCG names, elevated competitive intensity could limit Jyothy Laboratories Ltd.'s growth in the near term.
Market share gains, the success of new launches, a recovery in personal care, and the turnaround of HI portfolio will be crucial for Jyothy Labs' earnings growth.
Jyothy Labs' margin expansion beyond ~18% is also constrained by its focus on the mass and rural segments. Therefore, we believe its growth potential is adequately priced in at the current valuation.
We reiterate our Neutral rating on the stock with a target price of Rs 350 (premised on 30x Sep'27E P/E).
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