Grasim Industries Limited (ISIN: INE047A01021) has received a vote of confidence from Citi, which raised its target price for the company from Rs 3,400 to Rs 3,450 while maintaining a 'buy' rating. This comes despite the unexpected departure of Rakshit Hargave, CEO of Birla Opus, the company's paints division.

CEO Departure and Market Response

Rakshit Hargave, who oversaw the launch of Birla Opus over the past 18 months, has decided to join Britannia as Executive Director and CEO. His resignation, effective from the close of business hours on 5th December, 2025, was accepted by Grasim's Board of Directors in their meeting held on 5th November 2025.

While brokerages termed Hargave's exit a 'negative surprise' that could cause near-term caution and concerns about the paints division's direction, they remain optimistic about Grasim Industries' overall prospects. The company's strong quarterly earnings and Birla Opus's continued market share gains against established players like Asian Paints and Berger Paints have bolstered this confidence.

Analyst Outlook

Several major financial institutions have reaffirmed their positive stance on Grasim Industries:

• Citi: Raised target price to Rs 3,450, maintaining a 'buy' rating
• Morgan Stanley: Maintained Grasim as a 'top pick' with an overweight rating and Rs 3,690 target price
• Jefferies: Kept its 'Buy' rating with a Rs 3,500 target

Paints Business Progress

Despite the leadership change, Grasim Industries' paints business, Birla Opus, continues to make significant strides:

• All six state-of-the-art greenfield plants have commenced commercial production
• Total installed capacity has reached 1,332 million litres per annum (MLPA)
• The Kharagpur plant commenced commercial production on 15th October, 2025

Financial Performance

Grasim Industries reported robust financial results for Q2FY26:

• Consolidated revenue: Rs 39,900.00 crore, up 17% YoY
• EBITDA: Rs 5,217.00 crore, up 29% YoY
• PAT (Owner's share): Rs 553.00 crore, up 76% YoY

Segment Performance

The Building Materials segment, which includes the paints business, showed strong growth, offsetting challenges in other segments.

Future Outlook

With Himanshu Kapania, Managing Director of Grasim Industries, directly overseeing the paints business in the interim, the company aims to maintain its growth trajectory. The continued expansion of production capacity and market share in the paints segment, coupled with strong performance in other business areas, positions Grasim Industries for potential further growth.

Investors and analysts will be watching closely to see how the company navigates the leadership transition in its paints division while capitalizing on the momentum across its diverse business portfolio.

Grasim Industries , a flagship company of the Aditya Birla Group, has reported a robust performance for the second quarter of the fiscal year, with significant growth in both revenue and profitability. The company's financial results showcase its resilience and strong market position across its diverse business segments.

Financial Highlights

Grasim Industries has posted impressive year-on-year growth in its key financial metrics for Q2:

The company's consolidated net profit saw a substantial increase of 76% year-on-year, reaching ₹553.48 crore compared to ₹314.63 crore in the same quarter of the previous year. This significant jump in profitability underscores the company's effective cost management and operational efficiency.

Revenue from operations also showed strong growth, increasing by 16.6% to ₹39,899.58 crore, up from ₹34,222.54 crore in the corresponding quarter last year. This growth in revenue indicates robust demand across Grasim's business segments.

Segment Performance

The company's consolidated EBITDA rose by 29% to ₹5,217 crore, driven by improved profitability in both the cement and chemicals segments. This increase in EBITDA reflects the company's ability to enhance its operational performance across its diverse business portfolio.

Capital Expenditure and Future Plans

Grasim Industries continues to invest in its future growth:

• The company's capital expenditure for the quarter stood at ₹461 crore.
• Total paints business capex has reached ₹9,727 crore, indicating the company's commitment to expanding its presence in the decorative paints segment.

Analyst Perspective

Nuvama, a brokerage firm, has maintained a 'Hold' rating on Grasim Industries with a target price of ₹3,198. The brokerage highlighted that the company's Birla Opus decorative paints brand has outpaced industry growth, showcasing the success of Grasim's diversification strategy.

However, Nuvama has trimmed its EBITDA forecast by 3% due to an earnings miss. Despite this adjustment, the brokerage views Grasim as a value play, citing attractive valuation and long-term potential in the paint segment.

Conclusion

Grasim Industries' Q2 results demonstrate the company's ability to navigate challenging market conditions and deliver strong financial performance. The significant growth in net profit and revenue, coupled with strategic investments in the paints business, positions Grasim well for sustained growth in the coming quarters. Investors and market watchers will likely keep a close eye on the company's performance in its core segments and its expansion into the decorative paints market.

As the company continues to leverage its diversified portfolio and focus on operational efficiency, Grasim Industries remains a key player in India's industrial landscape, poised for further growth and value creation for its shareholders.