UBS has maintained a ‘Buy’ rating on Pidilite Industries, assigning a target price of ₹3,600, following the company’s solid operational performance and management’s bullish guidance for FY26. The brokerage highlighted that revenue and margins in Q4FY25 were broadly in line with expectations, and the outlook remains constructive across both consumer and B2B businesses.
According to UBS, management is targeting double-digit profitable UVG (underlying volume growth) in FY26, signalling confidence in a broader consumption recovery. Notably, rural demand continues to outpace urban, although sequential improvements have been noted in urban consumption too.
The brokerage emphasized Pidilite’s focus on rural and small-town markets, where it is refining its demand-generation playbook. In B2B, low to mid-teen growth is expected over the medium term, driven by the construction sector—particularly in residential and commercial infrastructure segments.
One of the emerging drivers is the paints division, which is said to be growing steadily month-on-month. Additionally, electronic adhesives represent a long-term opportunity, with management expecting the market size to reach $1 billion by FY30. Pidilite is also progressing with its partnership with CollTech, aimed at expanding capabilities in this space.
The report noted that raw material trends remain favourable, with vinyl acetate monomer consumption rates falling to $880/tonne, down from $925 in Q4FY24. UBS flagged that an exceptional item in Q4 was due to an impairment loss on investments and loans to an associate, while staff costs included ₹170 million in year-end adjustments.
Despite macro uncertainties, UBS believes Pidilite is well-positioned to deliver profitable, sustainable growth, supported by its leadership position in adhesives and waterproofing solutions.