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Axis Direct targets 10% upside for CCL Products after strong Q1
The brokerage points to 13.7% year-on-year revenue growth in the June quarter, helped by 20% volume expansion and stabilizing green coffee prices in the ₹3,300 to ₹3,800 range.
Axis Direct expects CCL Products to extend its recent rally, setting a target price of ₹1,245, which implies roughly 10% upside from the stock’s latest closing level. The view follows what the firm described as better-than-expected June quarter results and continued support from the company’s balance sheet and coffee price stability.
In its note, LiveMint Markets said CCL Products delivered strong Q1 FY27 performance, with revenue up 13.7% year-on-year. The increase was driven by about 20% volume growth and solid demand across segments, while the Continental brand gained market share, supported by expansion into Delhi and Mumbai.
Axis Direct also highlighted improving profitability, with EBITDA rising 21.7% year-on-year and the EBITDA margin expanding by 106 basis points to 16.1%. It attributed the margin support to stabilization in green coffee prices during the quarter, with capacity utilization around 65% to provide room for additional volume growth over the next few years.
On leverage and outlook, the brokerage said net debt fell to ₹963 crore in Q1 FY27, down ₹90 crore quarter-on-quarter, as the company continues deleveraging through healthy cash flow generation. Axis Direct flagged potential near-term margin pressure from El Niño effects, but cited management confidence, along with guidance for 15% growth in EBITDA and volumes in FY27.
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