DOMS Industries (DOMS IN) – Q1FY27 Result Update – Prioritizing market share over margins in turbulent times – BUY
Published on 04 Aug 2026
Given persistent volatility in RM prices, we cut our EPS estimates by 13%/5% for FY27E/FY28E. While top-line of DOMS IN was broadly in-line with our estimates, EBITDA margin declined 525bps YoY to 12.3% (PLe 13.3%) amid sharp RM inflation. Aided by capacity expansion in core stationery business (production at Umbergaon is expected to commence from 2QFY27E), widening product basket (SKU count is up by ~400 in last 1 year) and addition of a new brand (Reynolds) in the portfolio we expect sales/PAT CAGR of 21%/19% over FY26-FY28E. However, given increasing volatility in RM prices, we expect EBITDA margins to dip 310bps YoY to 14.2% in FY27E. Nonetheless, calibrated price revision and stabilization in RM prices should result in a recovery in EBITDA margin to 16.8% in FY28E. DOMS IN trades at 65x/42x our FY27E/FY28E EPS and we maintain BUY on the stock with a TP of Rs2,703 (50x FY28E EPS; no change in target multiple).
