Target: ₹813
CMP: ₹417.80
Gulf Oil Lubricant India Ltd (GOLIL), India’s second largest lubricant company after Castrol, has impressively gained market share and shown resilience over the tumultuous past three years.
Demand for lubricants is expected to increase due to increase in commercial vehicle (CV) cycle, improved movement of goods on national roads, increased industrial production and increased sales of utility vehicles (UV). These factors are expected to drive strong demand for lubricants from the B2B segment, which is responsible for generating 35 to 40 percent of GOLIL’s lubricant and oil volumes.
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In addition, GOLIL is proactively expanding its distributor network in new geographies to enhance the reach of its B2C lubricants business, which generates 60-65% of GOLIL’s lubricants and oil volumes with better margins in compared to your B2B business.
Overall, GOLIL’s strategic efforts are expected to positively impact its market share and financial performance, further cementing its position as a leading player in the Indian lubricants industry.
We initiate coverage on GOLIL with a target price of ₹813 (10.0X FY26 P/E) for the next 24 months.
