Supreme Industries shares rise 4% post Q3; what should investors do?

Supreme Industries shares rose 3.6 per cent in trade on BSE, logging an intra-day high at ₹3,472.2 per share. At 12:02 PM, Supreme Industries’ share price was trading 2.9 per cent higher at ₹3,445.9 per share. In comparison, BSE Sensex was up 0.13 per cent at 82,016.31.

 

The buying on the counter came after the company’s December quarter (Q3FY26) results came largely in line with the Street’s estimates. 

Supreme Industries Q3 highlights:

• In Q3, Supreme Industries reported an 18 per cent year-on-year (Y-o-Y) decline in consolidated net profit to ₹153.37 crore, as compared to ₹186.97 crore a year ago.
• The firm’s revenue from operations rose to ₹2,686.94 crore in Q3FY26, a 7 per cent Y-o-Y increase from ₹2,509.88 crore in Q3FY25.

Brokerages’ views on Supreme Industries

Motilal Oswal Financial Services | Buy | Target cut ₹4,200 

Motilal Oswal, in its note, said that macro headwinds for the polyvinyl chloride (PVC) industry are largely behind, as reflected in rising PVC prices from CY26, a recovery in demand, and double-digit volume growth for Supreme Industries over the past two quarters, supported by strong Q4 guidance. Margins are expected to improve on the back of the absence of inventory losses, stable to improving PVC prices, a better value-added products (VAP) mix, and faster growth in the high-margin CPVC segment.

 

The brokerage expects Supreme Industries to deliver 12 per cent/18 per cent/18 per cent compound annual growth rate (CAGR) in revenue/Earnings before interest, tax, depreciation and amortisation (Ebitda)/ profit after tax (PAT) over FY25–FY28. 

 

With one-year forward valuations near historical averages and business momentum improving, analysts see a favourable risk-reward over the next few quarters.

YES Securities | Upgrade to Buy from Neutral | Target: ₹4,249

Supreme Industries’ Q3FY26 performance was largely in line with expectations, with demand impacted by a sharp fall in resin prices due to the non-implementation of anti-dumping duty and lower infrastructure and government spending, according to the brokerage. 

 

While the brokerage remains confident on the volume growth trajectory, it believes near-term gains may come at the cost of margins, as companies push volumes to gain market share amid weak secondary demand. That said, analysts expect margins to improve from the 9MFY26 base of ₹10/kg, though management has cut FY26 Ebitda margin guidance to 13.5–14 per cent from 14.5–15 per cent.

JM Financial Institutional Securities | Buy | Target cut to ₹4,000 from ₹4,300

JM Financial said Supreme Industries delivered an in-line operating performance in Q3FY26, with consolidated Ebitda rising 2 per cent year-on-year (Y-o-Y) and 6 per cent quarter-on-quarter (Q-o-Q) to ₹310 crore. However, adjusted PAT declined 18 per cent Y-o-Y and 7 per cent Q-o-Q to ₹150 crore, below expectations, mainly due to a weaker-than-expected contribution from associates, particularly Supreme Petrochem.

 

The brokerage noted that PVC prices improved sequentially in January 2026 and are expected to firm up further alongside a gradual demand recovery. Factoring in the Q3 performance, lower PVC prices and reduced contribution from associates, JM Financial cut its earnings per share (EPS) estimates by 14 per cent for FY26 and 3–4 per cent for FY27E–FY28E.

 

Despite the earnings cut, JM Financial maintained a ‘Buy’ rating backed by strong operating cash flow generation (₹4,000 crore over FY25–FY28E), a net cash balance sheet, and sector-leading capex of ₹2,700 crore over FY25–FY28E.

 

Disclaimer: View and outlook shared belong to the respective brokerages/analysts and are not endorsed by Business Standard. Readers discretion is advised.