Marico Share Price Gains 3% in Weak Market; Motilal Oswal Sees 24% Upside Potential
Marico Share: In a surprising show of strength amid a weak broader market, Marico Ltd’s share price surged nearly 3% in early trading on Wednesday, March 26. The fast-moving consumer goods (FMCG) stock opened at ₹630 on the Bombay Stock Exchange (BSE), climbing to ₹643 before stabilizing at ₹636.90 around 10:05 AM.
Marico’s Stock Performance: A Strong Recovery
Marico has been on a steady growth trajectory over the past year. Here’s a look at its stock movement:
- 52-week high: ₹736.10 (recorded on February 1, 2025)
- 52-week low: ₹490.70 (April 4, 2024)
- Monthly performance: The stock gained 6% in March after an 11% decline in February.
- One-year growth: Nearly 30% appreciation.
This steady performance signals growing investor confidence in Marico’s long-term potential.
Motilal Oswal Bullish on Marico: 24% Upside Expected
Leading domestic brokerage Motilal Oswal Financial Services has reaffirmed its buy rating on Marico, setting a target price of ₹775. This implies an upside potential of 24% from the current levels.
After meeting with Marico’s management, the brokerage firm highlighted key growth drivers:
- Revenue and EBITDA Growth: Projected 11% CAGR in revenue and 13% CAGR in EBITDA during FY25-27.
- Premium Product Focus: A shift towards value-added segments, particularly in foods and premium personal care, with expected 20-25% CAGR.
- Strong Digital Business: Rapid growth in brands like Plix and Beardo.
- Wider Market Reach: Expansion through Project SETU and rising contribution from quick commerce (3% of India sales).
- Stable FMCG Demand: Rural demand is improving, and urban demand is expected to pick up in the next few quarters.
Marico’s Key Growth Strategies
Marico is focusing on long-term sustainable growth through the following strategic initiatives:
1. Strengthening Core Business
- The company aims to boost sales of its key brands, Parachute and Saffola, despite recent price hikes.
- It is focusing on brand innovation and consumer-centric product development.
2. Accelerating Growth in New-Age Businesses
- Marico is aggressively expanding its premium personal care and food segment, targeting 20-25% growth annually.
- It is enhancing its presence in direct-to-consumer (D2C) brands, especially in the digital ecosystem.
3. Expanding Distribution & E-commerce
- Through Project SETU, Marico is strengthening its General Trade (GT) network.
- Its quick commerce (QC) sales channel is seeing strong growth, contributing 3% of overall India sales.
4. Industry Outlook: Favorable FMCG Demand Trends
- Rural demand is improving, which bodes well for FMCG companies like Marico.
- Urban demand is set to recover with easing inflation and potential government incentives.
- FY26 outlook is positive, with expected benefits from a good crop season and supportive government policies.
Marico: Key Financial Ratios & Valuation
Below is a summary of Marico’s key financial metrics:
| Financial Metric | Value |
|---|---|
| Current Market Price | ₹636.90 |
| Target Price (Motilal Oswal) | ₹775 |
| Upside Potential | 24% |
| 52-Week High | ₹736.10 |
| 52-Week Low | ₹490.70 |
| P/E Ratio | ~50x FY27E EPS |
| Revenue Growth (FY25-27 CAGR) | 11% |
| EBITDA Growth (FY25-27 CAGR) | 13% |
| Digital Business Contribution | Growing rapidly |
| Quick Commerce Contribution | 3% of India sales |
Why Should Investors Consider Buying Marico?
Investors looking for steady growth and strong fundamentals should consider Marico due to:
- Consistent revenue growth & profit margins.
- Strong market positioning in FMCG.
- Aggressive expansion in premium and digital segments.
- Favorable long-term industry trends.
- Attractive upside potential (24%) as per Motilal Oswal.
Frequently Asked Questions (FAQs)
1. Why did Marico’s share price increase despite a weak market?
Marico’s stock rose nearly 3% due to strong investor confidence, steady growth prospects, and Motilal Oswal’s positive outlook on the company.
2. What is the target price for Marico as per Motilal Oswal?
Motilal Oswal has given a target price of ₹775, indicating a 24% upside potential from the current market price.
3. What are the key growth drivers for Marico?
- Expansion in value-added products (premium personal care & foods).
- Strong digital business performance (Plix & Beardo).
- Wider market reach through quick commerce and Project SETU.
- Steady rural and urban demand recovery.
4. Is Marico a good stock to buy for the long term?
Yes, Marico is a strong long-term investment due to consistent growth, premium product focus, and increasing digital presence.
5. How has Marico’s stock performed over the last year?
Marico’s stock has gained 30% over the last year, with a 52-week high of ₹736.10 and a 52-week low of ₹490.70.
Final Thoughts
Marico’s strong brand portfolio, aggressive growth strategy, and improving FMCG sector trends make it an attractive stock. With a 24% potential upside, it remains a solid investment for those seeking steady growth and long-term value.
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Disclaimer: This blog post is for informational purposes only and should not be considered financial advice. Investors should conduct thorough research and consult with a qualified financial advisor before making any investment decisions.