Marico Shares Hit Seven-Month High After Brokerages Raise Target Price
Nuvama upgraded the stock to 'buy' from 'hold' earlier and raised the target price on Marico to Rs 640 per share from Rs 574 apiece.
Shares of Marico Ltd. jumped to their seven-month high on Tuesday after brokerages raised the target price on the stock as revenue growth moved into positive territory after logging three straight quarters of a fall as demand sentiment remained steady in line with previous months.
Net profit of the company rose 5% over the previous year to Rs 320 crore in the quarter ended March, according to an exchange filing on Monday. That compares with the Rs 324.8 crore consensus estimate of analysts tracked by Bloomberg.
Nuvama upgraded the stock to 'buy' from 'hold' earlier and raised the target price on Marico to Rs 640 per share from Rs 574 apiece. The worst is behind, given early signs of rural revival, good rain, and a hike in Parachute prices, the research firm said.
Nirmal Bang also raised the stock's target price to Rs 570 from Rs 550 earlier. However, it noted that sales and earnings momentum needs to accelerate for any re-rating in the stock, as it is currently trading at a fair valuation of 37 times FY26E EPS.
The company is looking at faster growth in the food business and is aiming to surpass the Saffola edible oil business (as a percentage of domestic revenue) over the medium term, which will reduce sales and margin volatility, which is a positive, Nirmal Bang said.
Shares of the maker of Parachute hair oil rose as much as 10.50% intraday, the highest level since Oct. 3. They pared gains to trade 9.9% higher at 11:52 a.m., compared to a 0.8% decline in the NSE Nifty 50.
The stock has risen 6% year-to-date and 7.14% in the last 12 month. Total traded volume so far in the day stood at 17.29 times its 30-day average. The relative strength index was at 83.22, indicating that the stock may be overbought.
