NDR Takeaways: A Compounding Story
We hosted a Non-Deal Roadshow with Sirca Paints India Ltd. Management in Mumbai on March 13, 2026, with Institutional Investors, where discussions primarily focused on the wood coating industry dynamics (demand and supply trend, competitive edge and profitability expansion) and future growth prospects.
Management expects strong growth driven by capacity expansion and consolidation of the Wembley and Welcome facilities, portfolio expansion into mass wood coatings, increased domestic manufacturing of previously imported products, and structural demand from India’s growing furniture industry, supporting medium to long-term scale-up.
Valuation
We use a DCF-based approach to value SIRCA. Our base case scenario TP is INR 625/sh and the upside scenario (20–25% probability event) fair value is INR 800/sh, whereas our downside scenario (15–20% probability event) fair value is INR 360/sh.
Valuation
We believe SIRCA has a long runway of opportunity as high-quality PU-based wood coatings market in India is a structural growth story. Under these circumstances, we believe, the DCF-based approach is a suitable way to value SIRCA. In our DCF model, we have 5 years of explicit forecasts until FY30E, a terminal growth rate of 6% and WACC of 10.5%. We arrive at a TP of INR 625/sh. We did a sanity check of our DCF-based TP of INR 625/sh using FY28E PE multiple, which is ~33x and reasonable in our view, given SIRCA’s business fundamentals we discussed in the note.
