Overall revenue growth of 13 per cent was supported by the India business, which saw growth of 10 per cent, while international sales added to the overall growth with a 13 per cent increase in constant currency and 23 per cent in rupee terms.
The India business, which accounts for three-fourths of consolidated revenue, was powered by the Parachute (rigid/pure coconut oil) portfolio, which delivered 13 per cent year-on-year (Y-o-Y) growth, its highest in the past 22 quarters. The gains followed a price cut of 10 per cent in Q1FY27 in higher retail price packs, which was undertaken to pass on the benefit of easing copra prices.
Given the volume surge, Parachute achieved a record market share of 60 per cent, strengthening its leadership with a gain of over 570 basis points Y-o-Y. The company expects mid-single-digit volume growth to sustain going forward.
The value-added hair oil (VAHO) portfolio (Parachute Advansed, Nihar Naturals, Hair and Care) maintained its value growth momentum with a 21 per cent Y-o-Y gain and was aided by premium offerings. The mid- and premium segments grew by 15 per cent in volume terms.
While the Saffola edible oils portfolio saw value growth of 6 per cent, volumes declined at a high-single-digit rate. The volume dip was on account of the rationalisation of its lower-margin products.
In the new business segment, the foods portfolio grew 45 per cent Y-o-Y (including contributions from acquired brands 4700BC and Cosmix) and has crossed the ₹1,500 crore mark in annualised revenue. Within this, Saffola foods delivered early-teen growth, led by oats, muesli and soya chunks. Premium personal care and digital-first brands, too, are growing at a good pace and have hit annualised sales of ₹550 crore and ₹1,150 crore, respectively.
The company is targeting overall revenue of ₹20,000 crore by FY30 (FY26 sales at ₹13,600 crore) and expects to hit its target by FY29 if the current momentum sustains. Motilal Oswal Research is positive on Marico, supported by resilient core volume growth, improving premiumisation and the profitable scale-up of foods and digital-first businesses. The brokerage has reiterated a buy rating with a target price of ₹975.
Marico is one of the top picks in its coverage universe.
Growth was backed by gains on the profitability front. Gross margins saw an expansion of 600 basis points Y-o-Y, supported by lower copra costs. The company invested some of the gains at the gross level to increase its spending on advertising and promotions, which jumped 44 per cent. Operating profit grew by a robust 27 per cent, while operating profit margins increased by 200 basis points Y-o-Y to 18.2 per cent.
Elara Securities has upgraded the stock to a buy with a target price of ₹1,000. Analysts led by Amit Purohit at the brokerage raised their earnings estimates by 3.7-5 per cent over FY27-29, given excellent execution and confidence in scaling up the digital-first and foods businesses with margin improvement.
The company has raised its FY27 operating profit growth guidance to the mid-20s from the high teens earlier. This is backed by a favourable mix, stronger Parachute volumes and improving profitability in the foods and digital-first portfolios. Over the medium term, the company hopes to maintain mid-teens growth. JM Financial Research has also raised its FY27-29 earnings estimates by 2-4 per cent. Strong execution, a relatively favourable raw material scenario (copra deflation/lower exposure to crude oil versus peers) and an improving outlook provide comfort on earnings visibility, point out Mehul Desai and Pooja Kubadia of the brokerage. They have maintained a buy rating with a target price of ₹950.
