Motilal Oswal Keeps BUY Rating on Castrol India, ₹220 Target

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AuthorAarav Shah|Published at:
Motilal Oswal Keeps BUY Rating on Castrol India, ₹220 Target
Overview

Motilal Oswal reiterated its BUY rating on Castrol India, setting a target price of ₹220. The brokerage noted Q1 2026 results met expectations. While volumes grew in high single digits, EBITDA margins slightly contracted year-on-year. A significant surge in other income was a key contributor to the PAT performance.

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Motilal Oswal Reiterates BUY Rating

Motilal Oswal has maintained its BUY recommendation on Castrol India, setting a target price of ₹220 per share. The valuation is based on a 22x multiple applied to projected earnings for December 2027. The brokerage firm's stance follows a review of the company's first quarter results for the period ending March 2026.

Q1 2026 Performance Review

Castrol India's financial performance for the quarter ending March 2026 largely aligned with Motilal Oswal's expectations. Reported Profit After Tax (PAT) stood at ₹2.4 billion, meeting forecasts. Volume growth registered in the high single digits compared to the same period last year. However, Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA) margins saw a contraction of 30 basis points year-on-year.

A notable factor contributing to the profit figures was a significant increase in other income, which came in at ₹233 million, approximately 2.4 times the amount estimated by the brokerage. This surge in non-operational income played a crucial role in the overall PAT outcome.

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