Motilal Oswal Reaffirms BUY on Castrol India, Sets Rs 220 Target

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AuthorSatyam Jha|Published at:
Motilal Oswal Reaffirms BUY on Castrol India, Sets Rs 220 Target
Overview

Motilal Oswal initiated a BUY rating on Castrol India, setting a target price of ₹220. The brokerage cited Q1 CY26 results, which met estimates. While volumes saw high single-digit growth, EBITDA margins contracted slightly year-on-year. The report highlights a 2.4x surge in other income, a key factor in the PAT performance.

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Motilal Oswal Reiterates BUY Rating

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

Q1 CY26 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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