Gulf Oil Lubricants India posts strong quarterly performance, keeping its growth trajectory intact amid raw material challenges, with plans for capacity expansion and new business ventures bolstering investor confidence.
Gulf Oil Lubricants India has just delivered the kind of quarter that can reinforce a broker’s confidence without forcing it to change its valuation. Choice Institutional Equities kept its Buy rating and left its target price unchanged at ₹1,525, implying about 32% upside from the stock’s recent level around ₹1,204. The firm’s case rests on a business that is still gaining share, defending margins and building out new growth engines, even as raw material conditions remain uneven.
The latest results were stronger than the market had expected. Trade Brains said revenue, EBITDA and profit all came in ahead of estimates, while Livemint reported that total revenue rose to ₹1,016.45 crore in the June quarter, with operating profit of ₹111.28 crore and net income of ₹95.88 crore. Business Standard put standalone profit after tax at ₹96.66 crore on revenue of ₹996.36 crore, underscoring that the company continued to grow despite a difficult backdrop.
That backdrop mattered. Trade Brains said Gulf Oil protected its profitability through pricing discipline, including retail price actions and formula-linked adjustments in business-to-business contracts, after base oil costs jumped during the West Asia disruption. The company also benefited from 17% volume growth, helped in part by stocking by dealers and original equipment manufacturers concerned about supply security, while industry growth remained far slower at roughly 3% to 4%.
Choice Institutional Equities still trimmed its FY27 earnings assumptions by about 3% because of near-term margin pressure, but left FY28 estimates unchanged. The broker is also pointing to a capacity expansion from 140,000 kilolitres to 240,000 kilolitres in FY27, with new facilities in Chennai and Silvassa set to come on stream over the next few quarters. Beyond lubricants, Trade Brains said the company has lifted its stake in its charging technology unit to 65% after investing about ₹38 crore, and sees that business scaling to ₹300 crore to ₹400 crore in revenue over the next few years. Management has also reiterated an EBITDA margin goal of 12% to 14% in the near term and 14% to 16% later on, while considering acquisitions, backed by cash surplus of more than ₹1,000 crore and a 72% dividend payout ratio.
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