Nuvoco Vistas Corporation (NUVOCO IN) – Q2FY27 Result Update – Cost inflation to test price hike implementation – BUY
Published on 23 Oct 2026
Mgmt. is targeting capacity expansion to 35mtpa by FY28, backed by capex of INR12bn in FY27 and INR8-9bn in FY28, with the Vadraj ramp-up expected to drive incremental volumes and Gujarat volumes reaching an annualised 2mt by Q4FY27 from c.1.5mt currently. Net debt has risen to over INR50bn as on Sep’26 from INR45bn in Mar’26, warranting monitoring; however, management expects to reduce debt by FY27-end through working capital release and stronger H2 cash flows. Despite near-term cost pressures, sustained price hikes, logistics efficiencies and improving capacity utilisation should support margin recovery. We remain positive on Nuvoco’s medium-term outlook, supported by capacity expansion, expected demand growth of 7–8% in H2FY27 and the potential for Gujarat and Western Maharashtra EBITDA/t to match North levels by Q4FY28 or early FY29. We raise our EBITDA estimates by 1.2%/0.3% on higher pricing and expect it to deliver EBITDA CAGR of 13% over FY26-29E. The stock is trading at an EV of 6.3x/5.3x FY28/29E EBITDA. Maintain ‘BUY’ with revised TP of Rs560 (earlier INR557) valuing at same 9x EV of Mar’28E EBITDA.
