Patanjali Foods: what the price is assuming

PATANJALI has demonstrated a significant turnaround, moving from negative net profits in 2018-2019 to consistent and growing profitability since 2022, with recent annualized net profit growth exceeding 29% and sales growth around 14-15%. Operating profit margins have also shown improvement, from 2-3% to 4-6%, with management targeting 8-10% for the food business, indicating further room for profit expansion. Management's guidance for key segments, such as HPC exceeding 15% and Food growing 8-10%, combined with a decent promise track record (75% achieved/on-track), supports a defensible stage-1 growth rate of 14%. A 6-year stage-1 period is appropriate given the ongoing strategic initiatives, including oil palm plantation expansion targeted for FY27, allowing for sustained above-average growth before fading over 3 years to a conservative terminal growth of 3%. The suggested discount rate of 11% reflects the company's healthy leverage and improving financial stability, balanced against its past volatility.

• — our target clearly is that we want to exceed 15% is what we have set on the overall basis as a growth objective for HPC and on a fully annualized basis.
• — in the food space, we will grow between 8% to 10% will be our growth rate.
• — Our margin construct in the food business will be between 8% and 10% as well. That EBITDA margin, that's what we are targeting.
• — veg oil business, anywhere between 3% and 4% growth is what we target.
• — The orientation in terms of the planning that is entirely done by the company is on the volume growth of between 3% and 4%.
• — This year, our target is that we should do close to 40,000 additional hectares, which is a mix of 20,000 in the northeastern part of the country and 20,000 in the South India. And for that we need to prepare well in advance on getting our sprouts and nurseries and others. And we are very much on course for that. What I am saying this year is '26-27. I am talking now.

Through 2025-12-31