Domestic brokerage firms Motilal Oswal and ICICI Securities have both upgraded Gravita India to buy ratings with target prices of ₹2,100 and ₹2,020 respectively. Motilal Oswal set its target price based on 27x FY28E EPS representing a 10% premium to its five-year average P/E, while ICICI Securities values the stock at 30x FY28E EPS. The upgrades come after the company reported strong Q1 FY27 performance, with adj. EBITDA growth of 29% YoY, supported by increased EBITDA per MT in lead due to supply constraints and consolidation of the acquired copper business.
According to Motilal Oswal's latest research, the brokerage expects robust growth trajectory for Gravita India with CAGR of 37%/31%/24% in revenue/adj. EBITDA/adj. PAT over FY26-28. The company's performance was bolstered by supply constraints in the lead market and successful integration of its acquired copper business operations. The brokerage has largely maintained its earnings estimates while reiterating the positive outlook for the recycling company's growth prospects. ICICI Securities notes that diversification, value addition and incremental capacity could continue to drive GRAV's earnings story for the next 3-4 years.
Gravita India has earmarked capex of ₹16.8 billion, spread till FY29, to enhance its existing capacity to 654kt and new verticals to 146kt by FY29. As per ICICI Securities research, this aggressive expansion strategy aims to strengthen the company's position in the recycled materials sector. While Q1FY27 EBITDA of ₹1.09 billion (+9% YoY/-2.5% QoQ) was below expectations due to higher costs and geopolitical challenges, the long-term outlook on recycled material remains favourable. The company's focus on diversification and value addition is expected to drive sustained growth over the medium term.
Domestic brokerage firms Motilal Oswal and ICICI Securities have released their latest Q1 FY27 reviews, maintaining constructive ratings on several stocks across sectors. The brokerages have revised target prices on select names while maintaining positive stances on companies backed by strong growth visibility and improving earnings outlook. The stocks under their radar include Tata Capital, Gravita India, PN Gadgil, Supreme Industries, Indus Tower, and SAIL. The latest reviews reiterate the brokerages' positive stance on these companies, with both firms maintaining their selective approach to earnings-driven opportunities.
According to the brokerage reports, both Motilal Oswal and ICICI Securities remain constructive on the growth outlook for jewellery retailer PN Gadgil Jewellers and recycling company Gravita India. The firms' approach reflects a selective approach to earnings-driven opportunities, focusing on companies with clear growth visibility and improving earnings trajectories. However, ICICI Securities notes that aggressive capex and working capital requirements could inflate debt to new highs, representing a key risk factor to monitor. The revised target prices on select names indicate confidence in specific stock performance potential, with both brokerages reaffirming positive stances across their portfolio of companies under review.
