Morgan Stanley has retained its Underweight rating on Kajaria Ceramics and assigned a target price of ₹731 per share, implying a 41% downside from the current market price of ₹1,240.00.
Despite Q1FY26 adjusted PAT coming in 26% above estimates, driven by better margins in the tile segment, the brokerage remains cautious. Tile volume growth was flat at just 1%, indicating limited top-line momentum.
Morgan Stanley noted that Q1 margins were the highest in the past six quarters, and working capital days remained stable year-on-year. However, it believes that current valuations may not fully reflect the sluggish volume growth and sees limited upside from current levels.
Disclaimer: The brokerage views expressed above are those of Morgan Stanley. This article does not constitute investment advice. Readers are advised to consult their financial advisor before making any investment decisions.
