Shares of Grasim Industries soared over 6 per cent on Thursday after the company reported strong March quarter earnings, aided by better realisations, improved margins in the viscose staple fibre (VSF) business and lower losses in new-age ventures. Positive commentary from global brokerages, which highlighted strong execution in paints, chemicals and B2B e-commerce, further boosted investor sentiment.

The stock hit a 52-week high of ₹3,180 and closed 6 per cent positive at ₹3,154.50, compared to the previous close of ₹2,971.10.

Grasim Industries reported a 28 per cent y-o-y rise in consolidated net profit for the March quarter at ₹3,802 crore, compared to ₹2,973 crore in the corresponding period last year. The earnings growth was driven by strong operational performance in the VSF business, healthy chemicals volumes and continued scale-up in its paints and B2B e-commerce businesses.

The company’s management said during the post-earnings concall that Birla Opus is targeting ₹10,000 crore in profitable revenue in its third year of full-scale operations, with FY26 considered the first full year. The paints business aims to become the number two player in the decorative paints segment, with management guiding for high double-digit growth in FY27.

Management also said Birla Pivot is targeting EBITDA breakeven by the end of FY27 while continuing to deepen its category presence and grow revenues. Meanwhile, UltraTech Cement remains on track to achieve a capacity of over 240 million tonnes per annum by March 2028.

Grasim added that its capital allocation strategy will focus on reinvesting revenues and EBITDA from the standalone business into growth ventures, while maintaining over 50 per cent stake in UltraTech Cement and Aditya Birla Capital remains a long-term objective.

Global brokerage Jefferies maintained a buy rating on the stock and raised its target price to ₹3,600 from ₹3,440. The brokerage said Grasim delivered a strong exit to FY26, supported by improving performance in standalone businesses. It noted that Q4 earnings beat estimates due to robust VSF performance and lower losses in newer businesses.

Jefferies added that the paints business reported strong revenue growth with expanding market share, and it expects the momentum to continue through FY27. The brokerage also expects the B2B e-commerce business to turn profitable by the end of FY27. It attributed the strong VSF performance to a favourable product mix, operational efficiencies and lower pulp prices.

Citi also maintained a buy rating on Grasim and raised its target price to ₹3,600 from ₹3,450. The brokerage described the March quarter performance as resilient, highlighting sequential improvement in VSF EBITDA on a q-o-q basis.

Citi said Grasim’s paints business has crossed the 10 per cent market share milestone and expects the stock to increasingly track the performance of its cement and paints businesses, while continuing to receive support from the VSF and chemicals segments. It also expects the holding company discount to narrow further as paints profitability improves and dividend inflows from UltraTech Cement rise.

Morgan Stanley maintained an overweight rating on Grasim and raised its target price to ₹3,900 from ₹3,865, while naming the company as its analyst top pick. The brokerage said standalone EBITDA beat estimates, led by the cellulose and chemicals businesses.

Morgan Stanley highlighted that paints business revenue rose around 19 per cent q-o-q and estimated paints market share gains of at least 150 basis points sequentially. It expects Grasim’s exit market share in paints to cross 11 per cent and noted that industry paints growth guidance for FY27 remains in double digits.

The brokerage also said Birla Pivot revenue likely grew around 30 per cent q-o-q and sees multiple re-rating triggers for the stock, including paints value unlocking and scaling up of new-age businesses. It added that standalone net debt remained stable q-o-q at ₹69 billion.

Domestic brokerage motilal oswal reiterated its buy rating with a target price of ₹3,440. The brokerage said Grasim reported strong execution in paints and B2B e-commerce, margin expansion in VSF and healthy volume growth in chemicals.

Motilal Oswal added that brand investments, contractor ecosystem expansion and a premium product mix continue to strengthen the company’s position in the paints business. While cost pressures remain a near-term headwind, it expects margins to improve through operating leverage, procurement efficiencies and scale benefits. The brokerage also said improving VSF prices are likely to support healthy margins in the coming quarters.

Published on May 21, 2026