DOMS Industries Research Report

Company Overview

DOMS Industries (DOMS) is expected to maintain its revenue growth momentum, despite a relatively small contribution from the Middle East market, which accounts for less than 2% of its revenue.

Key Drivers

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• US orders have resumed following the easing of tariffs, with FILA-related exports to Europe and the US expected to continue without any tariff overhang.
• The company's procurement costs may be impacted by the 40-50% share of polymers and crude-linked derivatives in its raw material basket, but a price increase is likely to offset this pressure.
• Strong domestic demand and an extensive distribution network are expected to support revenue growth over the medium term.

Outlook

The company is on track to achieve its revenue guidance of 18-20% with an EBITDA margin of 16.5-17.5% for FY26. We upgrade the stock to BUY from Add, citing a 20% correction in the stock price over the past three months.

Valuation

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We value the stock at a DCF-based revised target price of INR 2,500 (vs. INR 2,600), with an implied P/E of 43x FY28E EPS. The risk-reward ratio appears favourable at this level.