Marico shares at 52-week high after robust Q3 business update; What’s next?

SYNOPSIS: Marico reported resilient Q3 performance with high single-digit volume growth, strong overseas momentum, easing input costs, improving margins, and brokerages expecting double-digit profit growth driven by pricing power and portfolio strength.

During Monday’s trading session, shares of one of India’s leading consumer products companies operating in the global beauty and wellness categories surged more than 2 percent to hit a new 52-week high at Rs. 775.55 on BSE, following its Q3 FY26 business update and positive outlooks from brokerages, including Nomura, Nuvama, and JM Financial.

With a market cap of Rs. 99,907.3 crores, shares of Marico Limited closed in the green at Rs. 769.65 on BSE, up by around 2 percent, as against its previous closing price of Rs. 757.6. The stock has delivered positive returns of around 19 percent in one year, and has gained by over 4 percent in the last one month.

Business Update for Q3 FY25

According to the latest exchange filing, Marico Limited said operating performance and demand trends showed gradual improvement in Q3 FY26 and remain optimistic on an upward trajectory, supported by easing inflation, GST cuts, MSP hikes, and a healthy crop season.

During the quarter, India business volumes grew in high single digits, with a sequential improvement. Parachute remained resilient despite pricing pressures, while Value Added Hair Oils delivered strong growth in the twenties. Foods was subdued but is expected to rebound over the next two quarters, and Premium Personal Care continued to scale steadily.

International operations stayed strong, posting constant-currency growth in the early twenties, led by Bangladesh, with Vietnam and South Africa returning to double-digit growth. Overall, consolidated revenue growth was in the high twenties, keeping the company on track to meet full-year targets.

On the cost front, copra prices have corrected sharply by nearly 30 percent, which should support margin recovery in the coming quarters. With margins expected to improve sequentially and brand investments sustained, Marico expects double-digit operating profit growth on a year-on-year basis.

Brokerages Outlook

I. Nomura expects Marico’s consolidated revenue to rise around 27 percent YoY in Q3 FY26, driven by high single-digit volume growth in India and sustained momentum in international markets. Operating profit is also estimated to grow in the early double digits, supported by sequential improvement in gross margins. 

The brokerage noted that Parachute coconut oil volumes are likely to see only a marginal YoY decline despite cumulative price hikes of nearly 60 percent. Adjusted for pack-size reductions, volumes were sequentially positive, highlighting strong pricing power. Overseas business delivered early-twenties growth in constant currency terms, led by Bangladesh, while Vietnam and South Africa rebounded to double-digit growth.

II. Nuvama said Marico’s revenue and EBITDA performance came in slightly ahead of its preview estimates, with volume growth of around 8 percent YoY, largely in line with expectations. It highlighted that Value Added Hair Oils (VAHO) revenue grew about 22 percent YoY, surpassing earlier estimates, driven by stronger demand in mid- and premium-priced products.

III. JM Financial observed that the decline in Parachute volumes was lower than anticipated, calling the category resilient despite high copra costs (a key input for coconut oil) and earlier price increases. However, Saffola edible oils continued to face pressure, with volumes remaining flat as the impact of past price hikes began to normalise. The brokerage added that VAHO growth accelerated into the twenties in Q3 from 16 percent in the previous quarter, supported by expanded direct reach under Project SETU and GST rate rationalisation on hair oils.

The brokerage expects Marico’s Q3 gross margin to improve to around 44 percent, a sequential rise of 135 bps, with EBITDA margin expanding to about 16.5 percent. Operating profit growth is projected to return to double digits in Q3, improving from mid-single-digit growth seen in H1 FY26.

IV. UBS pointed out that copra prices have corrected by around 30 percent from peak levels following the flush season, while crude oil derivatives have remained benign, offering relief on input costs.

V. Motilal Oswal identified a sequential improvement in gross margins, highlighting easing copra prices and stable crude derivatives, although vegetable oil prices continue to stay high.

Also read: Penny stock jumps 11% after reporting strong Q3 order book; Check details

Financials & More

Marico reported a significant growth in revenue from operations, experiencing a year-on-year increase of around 31 percent, from Rs. 2,664 crores in Q2 FY25 to Rs. 3,482 crores in Q2 FY26. In contrast, its net profit decreased during the same period from Rs. 433 crores to Rs. 432 crores, representing a marginal decline of nearly 0.23 percent YoY.

Marico Limited carries on business in branded consumer products.  In India, the company manufactures and markets products under the brands such as Parachute, Saffola, Saffola FITTIFY, Hair & Care, Parachute Advansed, Nihar Naturals, Mediker, Pure Sense, Coco Soul, Revive, Set Wet, Livon, Beardo, Just Herbs, True Elements and Plix. 

The international products portfolio of Marico includes brands like Parachute, Parachute Advansed, HairCode, Fiancée, Purité de Prôvence, Ôliv, Caivil, Hercules, Black Chic, Code 10, Ingwe, X-Men, Thuan Phat and IsoPlus.

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