Feb'25 View on Grasim Industries Ltd

Grasim Industries Limited is the flagship company of the Aditya Birla group, it ranks amongst India's largest private sector companies. On standalone basis, GIL’s core businesses comprise of viscose Staple fibre (VSF), caustic soda, speciality chemicals, rayon-grade wood pulp (RGWP) with plants at multiple locations. It also has certain other businesses such as fertiliser, textile, etc. After making high near 2,900 the stock has corrected steeply near 2,300 level and may make a double bottom before embarking to make way above 2,500 based on following inputs • Q3FY25: Robust growth in paints division. • Paints division saw a robust revenue growth with sequentially lower losses. • We expect margins to sequentially recover in CSF division and remain range-bound in the chemicals division hereon. • Paints: FY25E guidance of exit at high single-digit market share maintained. • We expect earnings per share (EPS) to grow by 45.1% in FY26E and by 30.3% in FY27E. • Chemicals: EBITDA up 17% qoq to Rs11/kg (+23% yoy). • Chemicals: Realizations improved (+10% yoy, +5.5% qoq) in caustic.