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On Thursday, JPMorgan adjusted its outlook on Dabur India (NSE:DABU) Ltd. (DABUR:IN), revising the company’s price target down to INR 495 from INR 500, while keeping a Neutral rating on the stock. The change follows Dabur India’s announcement of its fourth-quarter results, which showed a modest year-over-year revenue increase of 1% but a decline in EBITDA and profit after tax (PAT) by 9% and 8%, respectively.
Dabur India experienced a 3% drop in domestic volume, with notable performance setbacks in several product categories including beverages, over-the-counter (OTC) & Ethicals, health supplements, oral care, and hair care. In response to these challenges, Dabur India has shared its updated strategy aimed at driving double-digit revenue and profit compound annual growth rate (CAGR) from the fiscal year 2025 to 2028. The strategy includes concentrating on seven core brands, exiting non-performing segments such as tea, diapers, and health food drinks (HFD), and pursuing premiumization and contemporization of product formats. Additionally, the company is looking into strategic mergers and acquisitions, making bold moves in the health and wellness sector, improving go-to-market agility, and optimizing costs across the value chain.
JPMorgan’s analysis suggests that successful execution of these strategic imperatives is critical for restoring investor confidence and conviction in Dabur India’s stock. However, the firm noted that these initiatives have been part of Dabur’s operational strategy in the past as well.
For the near term, the outlook for the first quarter of the fiscal year 2026 remains cautious, though JPMorgan anticipates a slight sequential improvement. The firm also highlighted that the impact of recent geopolitical events on Dabur India’s international operations is an area of concern.
Despite a recent dip in share price and a moderation in valuations, JPMorgan prefers a cautious stance on Dabur India due to uncertainties surrounding the company’s growth revival.
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