Pidilite Industries Ltd. share price target

Pidilites 9.4 % YoY revenue growth (cons.) in 1QFY16 (Rs. 14.7 bn, below est) indicates sluggish demand. However, gross margin rose impressively by 515 bps YoY to 49.1%, highest since Q4FY10.

Pidilite Indisutries Limited (PIL) is India's dominant player in the adhesives & sealants segment, with its flagship product Fevicol' and other legacy products (M-Seal, Dr. Fixit, etc) that command ~70% of domestic market share and contributes around 50% to its topline. The Company operates through two major segments Consumer and Bazaar Products and Industrial Products contributing on an average of ~80% and ~20% respectively. We expect PIL to benefit over the near future on the back of (i) the strong Indian consumption story, (ii) rising demand from semi-urban and rural India, (iii) large investment in infrastructure and Housing for All by 2020 and (iv) a foreseeable surge in industrial activity. We expect...

Pidilites anticipated pick-up in demand seems further delayed as volumes grew merely 3.1% YoY (3QFY15: 8%). We are not worried, and are enthused by an upcoming margin expansion coupled with macro tailwinds.

Pidilite has a well entrenched distribution network, with a total of 1,000 distributors for Fevicol reaching 70,000 retail touch points. Similarly, 1,000 distributors exist for Mseal / Dr. Fixit...

Pidilite Industries Ltd(PIL) is the market leader in adhesives and sealants, construction chemicals, hobby colors and polymer emulsions in India. It has created brands like Fevicol, Dr Fixit, Cyclo, hobby ideas,...

construction chemicals, hobby colors and polymer emulsions in India. Its brand name Fevicol has become synonymous with adhesives to millions in India. Apart from adhesives, the company has expanded its presence in emerging segments...