Marico is in focus after reporting strong operating momentum in the December quarter. Brokerages pointed to revenue growth inching closer to the high twenties, resilient domestic volumes and a sequential recovery in margins, aided by easing copra prices. The consumer goods maker is firmly on track to deliver its full-year growth guidance, even as some categories, such as foods and Saffola oils, remain muted in the near term, as per top industry analysts.
Marico revenue outlook: Top brokerage views
According to Nomura, Marico expects consolidated revenue to grow around 27% year-on-year in the third quarter, supported by high single-digit volume growth in India and continued strength in overseas markets. Nomura estimates operating profit growth in the early double digits, aided by a sequential improvement in gross margins.
Nuvama Institutional Equities said the company’s revenue and EBITDA performance came in slightly ahead of its preview estimates, with volume growth of about 8% year-on-year in line with expectations.
Domestic volumes hold up despite sharp price hikes
At the heart of Marico’s performance is a steady recovery in domestic volumes. Analysts estimate India volume growth in the high single digits, improving sequentially from the September quarter, despite sharp price hikes in key categories such as Parachute coconut oil.
According to Nomura, Parachute coconut oil volumes are expected to decline only marginally year-on-year despite cumulative price hikes of around 60%. After adjusting for pack-size reductions, volumes were positive compared with the September quarter, indicating strong pricing power, the brokerage said.
JM Financial also said the decline in Parachute volumes was lower than expected, describing the category as resilient given elevated copra costs and pricing actions taken earlier in the year. Saffola edible oils, however, continued to see pressure. The segment reported a muted quarter as the impact of prior price hikes began to anniversary, resulting in flattish volumes and subdued value growth, Nuvama added.
VAHO and international business outperform
Value-added hair oils (VAHO) continued to be a key growth driver, with brokerages flagging sales growth in the twenties during the quarter, faster than in the previous quarter and ahead of earlier estimates.
Nuvama estimated VAHO revenue growth of about 22% year-on-year, higher than its earlier expectations, driven by stronger traction in mid- and premium-priced products.
Similarly, JM Financial said VAHO sales growth accelerated into the twenties in Q3 from 16% in the previous quarter, supported by increased direct reach under Project SETU and the benefit of GST rate rationalisation on hair oils. Marico’s international business also delivered strong growth. Nomura said overseas operations reported early-twenties growth in constant currency terms, led by Bangladesh, while Vietnam and South Africa returned to double-digit growth following targeted market initiatives.
Margins bottom out as copra prices ease
After several quarters of pressure, gross margins are showing signs of recovery. According to UBS, copra prices, the key input for coconut oil, have corrected by around 30% from peak levels, following the flush season, while crude oil derivatives remained benign.
Motilal Oswal Financial Services also flagged a sequential improvement in gross margins, citing easing copra prices and benign crude oil derivatives, though vegetable oil prices remained elevated.
Foods remain benign, recovery seen ahead
Marico’s food portfolio continued to see a benign phase after a period of strong expansion, with brokerages noting slower growth as the company consolidates its portfolio and sharpens its focus on profitability, particularly in its digital-first brands. However, most analysts expect the food business to return to a faster growth trajectory over the next two quarters.
Premium personal care, including digital-first brands, continued to scale well and was cited as an important margin lever over the medium term.
Brokerages raise targets, remain positive
Reflecting the improved outlook, several brokerages have revised their price targets upward while retaining positive ratings on the stock. UBS raised its 12-month price target to Rs 850 while maintaining a neutral stance, citing valuation comfort balanced against strong earnings visibility. Others, including Nomura, JM Financial, Nuvama and Motilal Oswal, reiterated buy ratings with price targets clustering between Rs 865 and Rs 875, supported by expectations of accelerating earnings growth into FY27.
Marico Share Price
Marico’s share price has remained flat during early trade on Monday. The stock is up over 7.33% in the last 1 month. Furthermore, it is up 15.37% in 2025.