Dabur Neutralized, Target Set at Rs 475: Motilal Oswal Research

Dabur's Growth Momentum Continues, But Execution Concerns Remain

Dabur's (DABUR) consolidated revenue witnessed a growth of approximately 7% year-over-year (YoY) in a flat base, with the India business revenue up by 10% YoY. The company noted a steady double-digit growth in the home and personal care (HPC) segment in the second half of FY26. In a positive development, India volume growth was estimated at 6%, surpassing the expected 4% and 3% in the third quarter.

Demand Conditions and Market Trends

Demand conditions in India remained steady, with rural markets continuing to outpace urban consumption by approximately 350 basis points. However, the unseasonal rains in March had a negative impact on Dabur's summer portfolio, which includes products such as glucose and nectars. Despite this, the company expects the growth momentum in HPC and healthcare (excluding glucose) to continue in the fourth quarter.

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Outlook and Recommendations

While maintaining a positive outlook on India consumption, the research team at Motilal Oswal remains concerned about Dabur's historical weak execution. Key factors that will influence the company's FY27 performance include general macro inflation and the monsoon season. As a result, the team reiterates a Neutral rating on the stock with a target price of INR475 (based on 35x the estimated earnings per share for March 2028).

Note: The above table compares Dabur's actual and estimated performance metrics.

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