Nuvama Institutional Equities glued the ‘Buy’ rating, with a target price of Rs 3,660 on Pidilite Industries after attending the company’s analyst meeting. The brokerage is confident in the company due to its continued focus on white spaces, headroom in tile adhesives, strong growth potential in the waterproofing segment, and emerging markets.
Nuvama On Pidilite Industries: Waterproof segment set to grow 50%
According to the research note, the waterproof segment, better known as Dr. Fixit, has the potential to grow by 50%, which as of now stands at 15% in new construction. While its share is 20% in small repairs and in proactive renovation.
Nuvama On Pidilite Industries: Strong outlook for tile adhesives
Moving forward to the tile adhesive category, the headroom to grow in tile adhesives is immense as only 25% of customers use tile adhesives for fixing tiles. “Roff” shall be a market maker in tile and stone solutions with a market size of Rs 2,500–3,000 crore. Penetration of this category is estimated at 18–20% as the majority of the market still uses cement to fix tiles. Pidilite Industries is collaborating in tile adhesive, marble finishing, and grouting and expanding plant capacity for Roff products to be closer to the market. The tile and stone market is shifting towards tile adhesives due to their stronger bonding compared with cement. This is because increased penetration of vitrified tiles, being non-porous and larger, poses challenges while thinner tiles are becoming more common.
Nuvama On Pidilite Industries: Scaling up in global markets
The company’s focus on international business is growing. The company plans to scale up its presence in Saudi Arabia over time. It is already doing business in more than 70 countries through its seven international subsidiaries. “Depending on individual market needs, Pidilite either adopts the products from India or adapts the products depending on the needs of each country. The company shall expand to those countries that are emerging markets and largely similar to India,” said Nuvama in a research note.
Talking about the leadership, the brokerage firm is positive about the company’s top-level leadership. “The company is focused on addressing white spaces and has two senior people at the CXO level apart from a dedicated team. In our view, Pidilite Industries remains a compounding machine. We believe the appointment of Mr Sudhanshu Vats as MD and Mr Kavinder Singh as Joint MD will bring strong leadership,” said Nuvama.
Pidilite share performance in 2025
On Wednesday, the share price of Pidilite Industries was trading 1% higher at Rs 2,759. The stock has given a negligible return in the past five trading days. The stock has fallen 1% in the last one month and 15% in the previous six months. The adhesive stock has dropped its value by 5% in the past one year.