A decade of strong foundations and profitable growth
Over the past 10 years, GALSURF has demonstrated its ability to scale profitably while navigating cyclical and regional challenges. During FY15-25, the company doubled its total volumes, supported by deeper market penetration and category expansion, particularly in rinse-off personal care and home care products. During this same period, EBITDA tripled, driven by operational efficiencies, product mix enhancement, and innovation. PAT grew 5x, reflecting sharp execution and cost control.
GALSURF achieved an average RoCE of 22%, a testament to disciplined capital allocation and return-oriented investment. EBITDA/kg also doubled, highlighting the company’s ability to extract more value per unit of product. Despite macroeconomic headwinds in the early part of this decade, including inflation and demand volatility, the company maintained strong profitability, setting a firm base for future expansion.
Vision 2030: Forging forward
Looking ahead to 2030, GALSURF has outlined an ambitious but well-structured growth roadmap. Over the next five years, the company plans to double its volumes and grow EBITDA by 2.5x, while sustaining a RoCE greater than 22%. Its key internal goal is to achieve an EBITDA/kg of INR25 by FY30. This growth will be driven by a mix of organic, portfolio-led, and ecosystem-driven initiatives.
The company expects 50% of incremental EBITDA to come from organic growth in rinse-off categories such as hair care, oral care, and body wash— segments where GALSURF already has a strong presence. Around 30% of EBITDA growth is projected to come from new product portfolios, particularly in high-value, leave-on categories like moisturizers, sunscreens, and serums. The remaining 20% will be driven by new avenues, including strategic partnerships, collaborations, and expansion into wellness and beauty-focused solutions.
GALSURF’s 2030 vision is centered on defending and deepening its leadership in India and AMET markets, winning new customers and applications in the Americas, and making focused inroads into specialties in the European Union. This will be enabled through what the management calls the ‘3D’ approach— Development, Digitalization, and Distribution—backed by investments in 1,800 innovation, technology, and talent.
Valuation and view
We believe that going forward, volume growth will be driven by the company’s steady focus on R&D (with an annual expenditure of INR400-500m), increased wallet share from its existing customers, and acquisition of new customers. Margin is also likely to expand gradually with an increase in the volume of premium specialty products.
We estimate a volume CAGR of 6% over FY25-27, driven by improving volumes in the Specialty Care segment across developed markets and a recovery in demand, albeit gradual, from rural and urban markets in India. The stock is currently trading at ~22x FY27E EPS of INR106 and ~14x FY27E EV/EBITDA. We value the company at 30x FY27E EPS to arrive at a TP of INR3,180. We reiterate our BUY rating on the stock.
