Marico Outlook: The business growth of Marico, a leading personal care company that has reached almost every home through Saffola and Parachute, is looking good.
Marico Outlook: The business growth of the leading personal care company Marico, which has reached almost every home through Saffola and Parachute, is looking good. According to market experts, its shares are getting very cheap right now, due to which it looks very attractive for investment. Its shares are currently at a price of Rs 496.05 on BSE and according to domestic brokerage firm Motilal Oswal, about 21 percent profit can be earned by investing at this price. Motilal Oswal has set a target price of Rs 600 for Marico.
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That’s why experts are betting on Marico
- Marico’s business is spread across India, Bangladesh, Egypt, Malaysia, the Middle East, South Africa and Vietnam. Its portfolio includes brands like Kavya Yush, Parachute, Saffola Honey, Set Wet, Parachute Body Lotion, Saffola Oil, Livon and Medicare.
- Its sales have grown at a CAGR of 6 per cent (Compound Annual Growth Rate) in the financial year 2015-2020 and are now expected to reach double digits in the financial year 2020-24. Its growth is looking promising, given the continued growth rate of its core segments beyond FY2024, higher targets in the food portfolio and a target of Rs 450-500 crore for its Digital First range of products.
- On the basis of diversification, its business growth is expected to be better than before.
- Given the strong earnings growth and healthy ROE (return on equity) of more than 30 per cent, its shares are getting cheaper than before.
- In view of all these things, brokerage firm Motilal Oswal has fixed a target price of Rs 600 per share for investing in Marico considering the buy rating.
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Shares are available at 25% discount
Marico’s shares had reached a price of Rs 606 on the BSE on October 18 in 2021 last year, which is a record high of 52 weeks. However, this level could not be sustained and due to slippage in it, it had fallen to a record low of 52 weeks of Rs 455.80 on January 27 this year. Since then, this stock has recovered only 9 percent so far and today is at a price of Rs 496.05 per share. However, it is still at a discount of about 25 percent from the record level of 52 weeks. According to market experts, it can reach a price of Rs 600, that is, by investing at the current price, you can earn 21 percent profit.
(The stock recommendations given in the story are those of the respective research analyst and brokerage firm. Financial Express Online takes no responsibility for the same. Investments in capital markets are subject to risks. Please consult your advisor before investing.)
