CMP: ₹612
Orkla India, led by strong legacy brands MTR and Eastern, enjoys a dominant market share in the core states of Karnataka, Kerala, AP and Telangana. The in-depth insight into regional tastes gives the country a strong competitive position. The company operates in spices and ready-to-eat meals and is expected to deliver steady domestic growth, driven by increasing household penetration in core markets and expanding its product portfolio.
Exports (21 percent of sales) remain a key growth driver, with a 22 percent share of branded spice exports and rising demand from the global Indian diaspora. Margin expansion and cash flow generation are expected through operational efficiencies and a better product mix, which will drive meaningful improvement in underlying ROCE.
We expect fiscal 25-28E revenue/EBITDA/PAT CAGR of 9/11/10 percent, driven by volume growth of 6 percent. Export revenues are expected to grow at a CAGR of 12 percent, while domestic revenues should grow at around 8 percent CAGR in FY25-28E. Better execution and control of overheads to improve EBITDA margin by 100 basis points over FY25-28E to 17.6 percent EBITDA margin in FY28E.
With scope for selective acquisitions and continued focus on execution, we initiate coverage on Orkla India with a Buy rating and DCF-based TP of ₹800.
Risks: Volatility of raw materials and unorganized competition. Contributions become commonplace
Published on December 24, 2025
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