Monarch Networth Capital has reiterated its ‘BUY’ rating for Borosil, maintaining the target price at Rs 420, up 22 per cent from Friday’s closing of Rs 343.15 on BSE. The brokerage firm highlights Borosil’s strong cost optimisation strategies and strategic growth plans as key factors for this valuation.
Borosil’s revenue growth was noted to be steady, while margins improved due to effective cost controls.
Borosil’s revenue performance in the current quarter has been solid despite challenging market conditions. Monarch Networth Capital notes that the company’s margin performance stands out, driven by reduced marketing expenses and optimised power and fuel costs aided by solar power projects in Rajasthan. These initiatives have significantly contributed to the company’s ability to maintain profitability.
The glassware division of Borosil reported a robust growth, with revenues increasing by 43 per cent year-on-year, reaching Rs 61.1 crore. This growth is attributed to a low base effect and increased in-house manufacturing, with current operations running at approximately 65 per cent utilisation, expected to reach full capacity by FY26-end, Monarch Networth said.
The non-glassware division also contributed to Borosil’s growth, recording a 15.4 per cent year-on-year increase in revenues to Rs 111.9 crore. This segment includes small home appliances and kitchen essentials, illustrating Borosil’s diversified product portfolio, which continues to expand.
Monarch Networth said Borosil’s management remains optimistic about achieving 20 per cent margins in the near term. The company’s EBITDA rose by 11.8 per cent year-on-year to Rs 37.3 crore, while the profit after tax surged by 87 per cent year-on-year to Rs 17.4 crore, supported by a higher other income which included a significant one-off gain.
Monarch Networth Capital expects Borosil to experience a meaningful recovery in the second half of FY26. This anticipated recovery is expected to be driven by festive season demand, export normalisation, and improved utilisation rates across its facilities, positioning Borosil for sustained success.
Borosil’s strategic investments include a new manufacturing facility in Rajasthan for vacuum insulated stainless steel bottles and containers, with an initial capital expenditure of approximately Rs 40 crore. This facility is projected to generate around Rs 120 crore in annual revenue in its first phase, highlighting the company’s commitment to innovation and growth.
Monarch Networth values Borosil at 35 times its Q1 FY28 EPS, reflecting confidence in the company’s strategic growth initiatives. This valuation underscores Borosil’s potential for sustained growth and its competitive edge over rivals such as Cello and La Opala.