Grasim Industries Ltd is entering a period of value unlocking across multiple verticals, according to Morgan Stanley, which has reiterated its ‘Overweight’ rating and target price of ₹3,500. The brokerage believes the company is benefitting from a diversified growth engine, including the rapidly evolving paints business, strong cement earnings via UltraTech, and a ramp-up in new-age businesses.
Morgan Stanley’s note highlights how Grasim’s paints foray under the ‘Birla Opus’ brand is progressing well, with market expansion, dealer onboarding, and competitive pricing expected to gradually ramp up revenues. The paints vertical is seen as a potential value-unlocking story, with the company aiming to grab significant market share in the ₹80,000+ crore decorative paints space.
UltraTech Cement, Grasim’s flagship subsidiary, continues to deliver strong earnings compounding, aided by capacity additions, pricing power in key regions, and operating leverage from scale. This segment remains the cash flow backbone for the group.
In addition to core businesses, Grasim is investing in fast-growing segments such as B2B e-commerce (via Birla Pivot) and fintech (via partnerships and digital platforms). Morgan Stanley believes these new-age ventures could scale meaningfully in the medium term, offering further rerating potential for the holding company.
Holdco discount — long a concern among investors — is also starting to moderate as value accretion becomes more transparent. Morgan Stanley says this improved visibility, coupled with market-wide focus on capital-efficient growth, sets Grasim up for medium-term share price appreciation.
