Geojit Financial Services Recommends Buying Balkrishna Industries, Targets Price of Rs 2547

Balkrishna Industries Sees Revenue Growth, Upgrades Rating to BUY

Balkrishna Industries (BKT) has reported a 6.6% year-over-year (YoY) growth in consolidated revenue to Rs. 2,933cr in Q4FY26, driven by a 5% YoY increase in sales volume to 85,820 MT. The company's revenue growth is attributed to a higher topline, which contributed to a 4.3% YoY growth in Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA) to Rs. 640cr in Q4FY26.

However, BKT's EBITDA margin narrowed by 50 basis points (bps) YoY to 21.8% in Q4FY26 due to a rise in raw material expenses (+11.6% YoY) and other expenses (+18.9% YoY). As a result, the company's reported profit after tax (PAT) declined by 18.7% YoY to Rs. 299cr in Q4FY26, primarily due to an adverse movement in other income.

Financial Performance Comparison

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Looking ahead, the company plans to maintain its US volume at 10% of total sales in FY27. BKT's capital expenditure (capex) estimate for FY27 is Rs. 1,500-1,800cr, along with an annual maintenance cost of approximately Rs. 200cr.

In light of the company's improved fundamentals, Geojit Financial Services has upgraded its rating on the stock to BUY, with a rolled-forward target price of Rs. 2,547, based on 26x FY28E adjusted Earnings Per Share (EPS).