Motilal Oswal has issued a buy rating on Marico with a target price of ₹900 in its research report dated March 30, 2026. According to the broker's analysis, Marico has been one of the best-performing stocks among FMCG peers during the last two years, delivering a 50% return. The recommendation is premised on 50x P/E on FY28 valuation metrics. As per ET Now, the brokerage has revised the target price to ₹900 from ₹875 earlier, maintaining its positive outlook on the company.
The ongoing geopolitical challenges are expected to have significant bearings on cost inflation across most FMCG companies, particularly on crude derivatives. However, Marico appears relatively less affected by overall raw material volatility compared to its FMCG peers. Copra accounts for approximately 50% of Marico's raw material basket and is currently witnessing a deflationary trend with prices having corrected by 40% from their peak. After registering 130% inflation over the past two years, copra prices are expected to continue their deflationary trend. This favorable raw material composition positions Marico well despite broader sector headwinds.
Crude derivatives including packaging constitute 18-20% of total raw materials for Marico, resulting in a relatively lower impact compared to the company's peers. Management has guided a base case EBITDA margin expansion of 150-200bp in FY27, and the broker believes this guidance remains achievable in the current environment. Marico is among the few companies where operating margins are projected to expand in FY27, providing a competitive advantage in the challenging cost environment facing the FMCG sector.
The recommendation comes amid broader challenges facing the FMCG sector, with ongoing geopolitical issues expected to impact cost inflation across most FMCG companies. Additionally, a weak rupee is also expected to increase import costs for these companies. Despite these headwinds, Marico's favorable raw material composition and pricing trends position it well for margin expansion in the coming fiscal year. The stock continues to attract positive attention from multiple brokerages, with ET Now reporting it as part of their latest stock recommendations for April 1, 2026.
