HSBC has maintained its buy rating on Marico with a target price of ₹870 per share, noting that the company’s latest performance remains broadly in line with expectations, supported by steady volume growth in India and improving operating leverage at the consolidated level.
The brokerage highlighted that India volumes grew around 8% year-on-year, reflecting resilient demand across core categories despite a mixed consumption environment. Consolidated operating profit delivered double-digit growth, aided by easing input cost pressures and disciplined cost management. HSBC noted that margin tailwinds remain firmly in place, providing visibility on profitability even as category-level performance remains uneven.
Within the portfolio, Parachute delivered another resilient quarter, continuing to demonstrate strong brand equity and pricing power. In contrast, VAHO (Value-Added Hair Oils) posted robust growth of around 20% YoY, underscoring continued premiumisation trends within the hair care segment. However, the foods portfolio recorded a second consecutive muted quarter, which HSBC identified as a key area to monitor going forward.
HSBC believes that while near-term foods performance remains soft, the broader portfolio mix, stable volume growth, and margin tailwinds position Marico well for steady earnings delivery. The brokerage added that any improvement in foods could provide incremental upside to the current growth trajectory.
Disclaimer: The views and recommendations above are those of HSBC. Business Upturn does not endorse them. Please consult a financial advisor before making investment decisions.
