Nuvama Institutional Equities has reiterated its 'Buy' rating on Atul Ltd following a steady quarterly performance, while raising its target price on the stock.

"Atul reported a healthy quarter, slightly missing our estimates but inline with consensus, adjusting for reversal in employee provisions. Sales grew 15.0 per cent YoY (year-on-year) to Rs 1,670 crore, while gross margin declined 320 basis points (bps) YoY to 46.5 per cent due to compressed spreads in Aromatics and Polymers," the domestic brokerage said.

"Management intends to focus on sweating existing assets, while not shying away from inorganic opportunities. They are also evaluating large investments, but in the near term, headwinds due to geopolitical tensions could weigh on margins," it added.

Nuvama has increased its earnings estimates. "We increase our FY27/FY28 estimates by 8 per cent each and continue to value Atul at 30x FY28E EPS, with a revised target price of Rs 8,451 (earlier Rs 7,857); we reiterate 'BUY'. At CMP, the stock trades at 28x/24x FY27E/FY28E EPS," the brokerage stated.

Separately, the company's board has proposed a dividend of Rs 30 per equity share for the financial year ended March 31, 2026. The payout is subject to shareholder approval at the Annual General Meeting (AGM) scheduled for July 31, 2026.

"The Board of Directors has proposed a dividend of Rs 30 per equity share for the year ended March 31, 2026, subject to approval of the members at the ensuing AGM," the company said.

Record date

Atul has fixed July 17, 2026, as the record date to determine eligible shareholders. "The Register of Members and Share Transfer Books shall remain closed from July 18, 2026, to July 24, 2026 (both days inclusive) and accordingly the record date for the purpose of ascertaining the eligibility of the members to receive the dividend is July 17, 2026," it said.

The company added that, if approved, the dividend will be paid on or after August 5, 2026.