Grasim shares hit 52-week high in FY26 Q4; Buy calls

Stock jumps to a new high after Q4FY26 update

Grasim Industries shares were in strong demand on Thursday, rising 4.67% to touch a 52-week high of ₹3,110 on the NSE. Another report pegged the day’s peak at ₹3,116.90, described as an all-time high, with the stock also emerging as a top Nifty gainer. The move came a day after the company announced its March quarter earnings for Q4FY26. Market sentiment was aided by a cluster of brokerage notes that reiterated positive views on the company. The key drivers cited were momentum in the paints business, progress in the B2B e-commerce platform, and margin improvements in Viscose Staple Fibre (VSF) and chemicals. Brokerages also pointed to ongoing and planned capacity additions, which they believe improve long-term visibility across segments.

Q4FY26 numbers: revenue beat, loss narrows with one-time cost

For the March quarter, Grasim reported a consolidated net loss of ₹164 crore versus an analysts’ view of a net loss of ₹142 crore. The company also incurred a one-time cost of ₹81.86 crore. Excluding this one-time cost, the net loss would have been ₹81.7 crore, which was described as better than Street expectations. Revenue grew nearly 32% year-on-year to ₹11,774 crore, above the estimate of ₹10,616 crore. In a separate update included in the provided text, Grasim also reported its highest-ever EBITDA of ₹25,872 crore, up 29% year-on-year, driven by scale benefits, operational efficiencies, and improved profitability across segments. The board recommended a dividend of 500% at ₹10 per equity share of face value ₹2 for FY26, subject to shareholder approval at the upcoming AGM.

Motilal Oswal: Buy maintained, ₹3,440 target

Motilal Oswal Financial Services (MOFSL) reaffirmed a ‘Buy’ rating on Grasim Industries with a target price of ₹3,440. The brokerage cited strong execution in paints and B2B e-commerce, margin expansion in VSF, and healthy volume growth in chemicals. MOFSL flagged near-term cost pressure as a headwind, but said margins could improve through operating leverage, procurement efficiencies, and scale benefits. The brokerage also wrote that there has been an improvement in VSF prices, which should support healthy margins in coming quarters. MOFSL’s note added that Grasim targets building a ₹10,000 crore profitable franchise by FY28. Separately, one report said MOFSL raised its FY27 earnings per estimate 2.6 times on account of high dividend income from UltraTech Cement.

Choice Institutional: Buy retained, ₹3,500 target and paint-led thesis

Choice Institutional Equities retained a ‘Buy’ rating with a target price of ₹3,500 per share, implying about 13% upside from the then current market price. Choice said it remains positive on Grasim due to the company’s stated goal of achieving the number two position in paints with a ₹10,000 crore run-rate by FY28E. It also highlighted a Lyocell expansion of 110 KTPA, with Phase-I commissioning of 55 KTPA targeted by mid-2027. In chemicals, Choice noted a target of over 40% renewable usage by FY27. For Birla Pivot, the brokerage referenced a more than $100 billion addressable market over the next three to four years. Choice expects EBITDA for the standalone entity to grow about 36.9% over FY26 to FY29E, citing scaling in paints, higher volumes, and rising adoption of the B2B e-commerce platform.

How brokerages are valuing the paints business

Choice said it values the paints business at 2.5x FY27E EV/sales, pointing to accelerating market share gains and a ₹10,000 crore revenue target within three years of full capacity commissioning. It also referenced an investment outlay of ₹12,000 crore in the context of its valuation framework. The brokerage note mentioned applying a 25% holding company discount to subsidiaries and investments. These valuation references mattered because much of the near-term debate on Grasim has centred on how quickly new businesses, especially paints and B2B, can reduce losses and contribute meaningfully to consolidated profitability.

More broker views: Morgan Stanley, Citi, Jefferies, Nuvama

Morgan Stanley named Grasim as its top pick after Q4FY26, highlighting that standalone EBITDA beat estimates, driven by strength in the cellulose and chemicals businesses. It added that paints revenue rose around 19% quarter-on-quarter and estimated market share increased by at least 150 basis points sequentially, exiting the year at over 11%. Citi said Grasim delivered a resilient Q4, with VSF EBITDA improving quarter-on-quarter, and noted paints market share has crossed 10%. Jefferies said the standalone business showed improvement, pointing to a Q4 beat driven by strong VSF performance and reduced losses in new businesses, supported by better mix, efficiencies, and lower pulp prices. Jefferies also estimated Birla Pivot grew around 30% sequentially and said the B2B e-commerce platform is seen turning profitable by the end of FY27. Nuvama Institutional Equities upgraded Grasim to ‘Buy’ from ‘Hold’, raised its target price by over 6% to ₹3,546, and also cut its FY26-27 EBITDA estimate by 7% citing likely volatility in raw material prices.

Management’s paint ambition and why it is central to the rerating

In a post-earnings conference call, Grasim management said it aims to be the second-largest decorative paints company in India at the earliest. Multiple broker notes linked their constructive stance to evidence of market share gains in paints. One note described Grasim’s paints growth as nearly 3x the decorative paints industry average growth rate, alongside positive feedback from channel checks. The combination of market share milestones and an explicit revenue ambition of ₹10,000 crore by FY28E is shaping how investors assess the payback period of the paints capex and the trajectory toward profitability in the segment.

Key data points at a glance

Market impact and what investors are tracking next

The immediate market reaction reflected a combination of a revenue beat, a narrower underlying loss when adjusting for one-time items, and upgraded confidence in the paints strategy. Brokerages also tied their view to improved VSF pricing and chemicals performance, suggesting the legacy businesses are supporting the investment phase in new segments. Targets and timelines are now central to the narrative, including the ₹10,000 crore paints run-rate by FY28E, Lyocell Phase-I commissioning of 55 KTPA by mid-2027, and chemicals renewable usage above 40% by FY27. Investors will also track progress on Birla Pivot and the timeline referenced by Jefferies for potential profitability by end-FY27. Separately, the recommended FY26 dividend of ₹10 per share and commentary about dividend income from UltraTech Cement featured in broker notes as a factor shaping earnings expectations.

Conclusion

Grasim’s rally to a fresh high followed Q4FY26 numbers that beat revenue estimates and a series of brokerage reiterations on the stock. The next set of checkpoints will be segment execution in paints and B2B, margin behaviour in VSF and chemicals, and progress against the company’s disclosed capacity and commissioning timelines.