ICICI Securities has set a target price of ₹510 for Mishra Dhatu Nigam, citing strong quarterly revenue growth and a new strategic certification. While the company's operating margins faced pressure in the first quarter of fiscal year 2027, the brokerage expects these to normalize as production efficiency improves.
ICICI Securities has issued a 'Buy' rating on Mishra Dhatu Nigam (MIDHANI), setting a target price of ₹510 per share. This outlook follows the company’s performance in the first quarter of fiscal year 2027, where it reported revenue of ₹239.49 crore, marking a 40.46% increase compared to the same period last year. The stock has been trading in the ₹426–₹437 range as of mid-August 2026.
The brokerage noted that the revenue growth was driven by improved efficiency in converting raw materials into finished products. However, the company's operating profit margin stood at 15.3% for the quarter. This represents a decline compared to earlier periods, primarily due to higher raw material and energy costs, specifically LPG, which saw significant price increases amid global supply disruptions. Analysts suggest that if these one-time costs are adjusted, the profit margins align more closely with the company’s internal targets.
A key highlight in the report is the company’s recent success in securing the S400 certification from GE Aerospace. This is a significant development for MIDHANI, as it provides the company with broader access to the market for specialized titanium alloys and steels. Historically, these materials have been imported, so this certification could help the company capture a larger share of the domestic market as it looks to replace expensive imports.
The company’s order book, which stood at ₹2,329 crore as of July 1, 2026, continues to provide visible revenue opportunities. However, investors should be aware of potential risks. The business remains sensitive to fluctuations in raw material prices and energy costs, which can impact profitability. Furthermore, the company has significant planned capital spending of roughly ₹1,000 crore over the next three years. Successfully executing these expansion projects without straining the balance sheet or facing long delays will be crucial.
Additionally, as a supplier to the defense and aerospace sectors, MIDHANI’s performance is closely tied to government procurement cycles and defense spending policies. Any changes in these government priorities or delays in the qualification of aerospace components could affect the company’s growth trajectory. The company expects profit margins to improve and normalize by the third quarter, and investors will likely monitor whether the company can maintain its revenue momentum while keeping costs under control.