Buy Safari Industries; target of Rs 2600: Motilal Oswal

About this update from Safari Industries (india) Limited

Motilal Oswal's research report on Safari IndustriesSafari Industries’ (SII) 3QFY26 print misses our estimate; revenue grew 15.7% to INR5.1b, supported by ~20% YoY volume growth. EBITDA/PAT grew 10.5%/5.6% YoY. Management indicated that heightened competition to chase volumes led to elevated discounting across both offline and online channels in 3Q. Though the offline channel delivered ~22% growth, e-commerce grew slower at ~12–15%. Management assumes the healthy volume momentum to continue in 4Q as well. We expect SII’s revenue momentum to outpace the industry (+16% CAGR), driven by improving capacity utilization at the new Jaipur plant, while EBITDA margins are likely to be in the range of ~13.5–14.5% over the next two years.OutlookWe have trimmed our earnings while reiterating our BUY rating with a DCF-based TP of INR2,600 (based on an implied P/E of 46x on FY28). Key risks: delayed capacity expansion and sudden rise/discounting by regional competition (refer to our IC note dated Sep’25).For all recommendations report, click hereDisclaimer: The views and investment tips expressed by investment experts/broking houses/rating agencies on moneycontrol.com are their own, and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.Safari Industries_16022026_Motilal Oswal

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