Marico Bangladesh valuation report: fair value BDT 1,926–3,930 (Oct 2026)

Investment case: copra sets the margin, payout near 100% sets the value; fair value BDT 1,926-3,930

Marico Bangladesh is a coconut-oil franchise that hands almost all of its profit to shareholders. Parachute coconut oil earned BDT 11.7bn, 56.6% of FY2026 revenue (year to March 2026), and value-added hair oils such as Parachute Advansed and Nihar another 29.6% [1 p.188]. The Indian parent, Marico Limited, owns 90% [1 p.240]. It takes a royalty of about 0.95% of sales and a technical fee of about 0.5%, and received BDT 9.99bn of dividends in FY2026 [1 p.242]. The company paid out 101% of FY2026 earnings and 205% of FY2025's [1 p.32], so its book value is only BDT 94.85 a share [3 p.7].

The story of the last 18 months is copra. Revenue rose 27% in FY2026 to BDT 20.7bn, but cost of sales rose 59%. The gross margin fell from 59.7% to 49.4% on 'increase in prices of key raw materials' [1 p.181] [1 p.188]. About 61% of materials are bought from the parent's Dubai sourcing arm, Marico Middle East [1 p.240], so both the world coconut-oil price and the taka-dollar rate pass straight into cost. In the first half of FY2027 growth slowed: revenue rose 4.4% to BDT 10.56bn, Parachute revenue rose 1.0% and VAHO fell 7.0%, while gross margin was 50.3% against 52.8% [3 p.8] [3 p.29]. EPS was BDT 102.82 against BDT 110.52 [3 p.8]. Profit has held up only because advertising was cut and part of the profit is tax-free in the Mirsarai Economic Zone plant [1 p.243].

We value MARICO at BDT 1,926-3,930 a share, base 3,016. The base blends a free-cash-flow DCF at a 13.9% cost of equity and 6.2% terminal growth (BDT 3,038, 60%) with a two-stage dividend discount model (BDT 2,984, 40%) [10]. The price of BDT 2,642.5 on 29-Oct-2026 [7] is inside our range, below the base. At that price our DCF implies perpetual growth of 4.6%, against the 6.2% we use. The range is wide because the copra cycle moves gross margin by 10 percentage points: our base has EPS flat at BDT 211 in FY2027F and rising to BDT 233 in FY2028F as copra eases.

Marico India owns 90% and takes about 1.5% of sales in royalty and fees; Mirsarai makes 25% of profit

Marico Bangladesh Limited (MBL) makes and markets hair oils, personal care and food products under the Parachute, Parachute Advansed, Nihar, Saffola, Just for Baby, Livon, Fiera and Parachute Naturale brands [1 p.179]. It runs three plants. Shirirchala (Gazipur) crushes copra and fills coconut oil. Mouchak makes water-based products, shampoo sachets and honey. The Mirsarai Economic Zone plant began commercial operation on 4-Jul-2023 [1 p.180] [1 p.243]. Installed capacity is 72,000 tonnes of copra crushing, 36,500 tonnes of Parachute coconut oil, 28,860 tonnes of VAHO, 12,000 tonnes of water-based products and 4,000 tonnes of edible oil [1 p.242]. The Mirsarai plant already produced BDT 3.76bn of revenue and BDT 1.92bn of pre-tax profit in FY2026, a quarter of the company's total [1 p.243].

Marico Limited, India owns 90% [1 p.240]. At 30-Sep-2026 institutions owned 6.81%, the public 2.45% and foreign investors 0.74% (DSE company page) [6]. The parent is paid three ways. The royalty was BDT 197.5mn in FY2026 (0.95% of revenue). The general and technical assistance fee was BDT 103.1mn (0.50%) [1 p.237]. Dividends remitted to India were BDT 9.99bn, net of tax [1 p.242]. A fourth flow is input purchases. Marico Middle East FZE, a group company, sold MBL BDT 6.44bn of raw materials in FY2026. That exceeds 10% of the prior year's revenue, so it needs shareholder approval under the BSEC related-party notification of 22-Mar-2021; approval was obtained at the 25th AGM and will be sought again at the 26th [1 p.182] [1 p.240].

Management is changing. Managing director Sumitava Basu is reappointed only to 31-Jan-2027. Siddhartha Vachaspati takes over for three years from 1-Feb-2027, subject to the AGM [6]. The company is rated AAA/ST-1 (CRISL, Sep-2026) [6]. It has no bank debt and lease liabilities of BDT 149mn [1 p.217].

Parachute coconut oil is 57% of sales; its revenue fell 0.6% in the June 2026 quarter after a 24% year

Revenue by category is the best window into the business, because Marico does not publish volumes. Parachute coconut oil grew from BDT 8.59bn in FY2024 to BDT 11.73bn in FY2026 (+10.1%, then +24.0%). Value-added hair oils (VAHO), led by Parachute Advansed, Beliphool and Nihar, grew 14.7% and 26.1% [1 p.188] [4 p.232]. Management says the growth came from 'robust sales of flagship products' [1 p.188]. With copra costs up about 60%, much of FY2026's 24% Parachute growth must have been price, but the split is not disclosed (a labelled gap).

The June 2026 quarter showed the cost of those price rises. Parachute revenue was BDT 3,042mn against 3,061mn (-0.6%) and VAHO BDT 1,420mn against 1,561mn (-9.0%). Health & Beauty almost doubled to BDT 586mn and 'others' (male grooming and by-products) to BDT 181mn [2 p.28]. Health & Beauty includes Saffola Active, a cooking oil sold on heart health, and Saffola Active+ honey [1 p.108]. It is Marico's way into edible oil, a much larger market than hair oil, although its own edible-oil capacity is only 4,000 tonnes [1 p.242]. The baby segment fell 16%.

Our forecast builds each category from volume and price. Parachute volume falls 2% in FY2027F after the price steps, then grows 4% a year, with price up 4% in FY2027F and 3% a year after. VAHO volume falls 6% in FY2027F, in line with the June quarter, then grows 5%. Health & Beauty grows 45%, 20% and 15%. That gives revenue of BDT 21.7bn in FY2027F (+4.9%) and BDT 25.6bn in FY2029F. Parachute's share slips from 56.6% to 53.6% [10].

Parachute owns about 80% of branded coconut oil; growth now has to come from volume and new categories

Parachute dominates branded coconut oil in Bangladesh. The Business Standard put Marico's share at 80% in 2022 and the branded and loose coconut-oil market at about Tk 2,000 crore (BDT 20bn) [13]. That is one outlet with no named source, so we treat it as context. Parachute revenue was BDT 11.7bn in FY2026 [1 p.188]. Local rivals include Square's Jui, Mousumi's Cute and City Group's new brand, and loose oil from mills is the low-price option [13]. In value-added hair oils and skin care the rivals are Unilever, Square Toiletries, Kohinoor and Keya. Marico reached over 790,000 outlets, reported by The Daily Star [12].

Demand is steady, not fast. Hair oil is a small part of the household budget, so high inflation hit it little, reported by The Daily Star [12]. The directors expect GDP growth of about 3.9% in FY2025-26 and inflation of 8.6% [1 p.179]. Our long-run growth of 6.2% for MARICO in nominal taka is built in the valuation section from 1.5% volume and mix plus price growth of 4.6%: long-run inflation of 6.1% implied by the 10-year bond, less 1.5 points because an ~80% share and loose oil limit pricing. Current inflation (8.6%) is above that long-run level.

The bigger change is in the share register. Foreign investors cut their stake from 1.91% in March 2026 to 0.91% in August, offloading about Tk 85 crore of shares, reported by The Business Standard [11]. The free float is small. Average daily turnover over three months is about BDT 8mn [7], so trading BDT 100mn of the stock would take about 13 sessions of the whole normal volume.

Copra took materials from 37% to 48% of revenue; each 10% in taka is about 2.9% of margin

Copra (dried coconut kernel) and crude coconut oil are the biggest cost. Materials consumed rose from BDT 6.12bn in FY2025 to BDT 9.92bn in FY2026, a 62% jump on 27% higher revenue [1 p.236]. Materials and stock changes went from 36.9% to 47.8% of revenue [10]. Bangladesh grows too little coconut, so MBL imports: BDT 6.44bn of FY2026 raw materials came from Marico Middle East FZE [1 p.240], 61% of total purchases of BDT 10.48bn [1 p.236]. Import cost is the world coconut-oil price times the taka-dollar rate. World Bank projections, cited by The Daily Star in January 2025, had coconut-oil prices rising in 2025 and easing from 2026 [12]. We have no primary copra price series (a gap).

In the June 2026 quarter materials consumed were 45.7% of revenue against 41.8% a year earlier, and the gross margin was 49.5% against 55.7% [2 p.8] [2 p.28]. Raw-material stock rose to BDT 3.64bn from 3.09bn [2 p.28], so expensive copra is still in the pipeline. Pass-through is slow. MBL raised prices in FY2026, but volume is now falling, so more price rises would cost volume. Our base assumes the copra price in dollars rises 2% in FY2027F, falls 10% in FY2028F and 3% in FY2029F, with the taka weakening 3% a year. Materials go from 47.0% of revenue in FY2027F to 45.1% in FY2029F, and the gross margin recovers from 50.1% to 52.0%. That is still below the five-year median of 54.3% [10].

Each 10% move in the copra basket in taka, not passed on, moves the gross margin by about 2.9% points and FY2028F EPS by about 7% (Exhibit 12) [10].

The economic-zone tax holiday cut the tax rate to 14.6%; we take it to 17% by FY2029F

Marico paid BDT 761 crore (BDT 7.6bn) to the exchequer in FY2026, 12% more than a year earlier. That includes BDT 305 crore of income tax and BDT 231 crore of import-stage duties and VAT [1 p.182]. On profit, the effective tax rate fell to 14.6% from 22.0%. The listed-company rate was 20% [1 p.239], and BDT 384mn of tax was saved on income exempt in the Mirsarai Economic Zone [1 p.239] [1 p.243]. The company 'intends to take advantage of the income tax benefits' under the BEZA rules and SRO 104/2020 [1 p.243].

The exemption steps down. The filing does not print the schedule. We assume the standard BEZA ladder: 100% for the first three years, then 80%, 70% and 60%. Mirsarai's fourth year starts in July 2026, so we model 85% of its profit exempt in FY2027F, 72.5% in FY2028F and 62.5% in FY2029F. The effective rate goes to 16.2%, 16.9% and 17.4% (Q1 FY2027 actual 15.0% [2 p.8]), and to 20.5% in the long run [10]. If the exemption ended at once, fair value would be BDT 2,946 [10].

Other rules that touch the lines: VAT and supplementary duty at the factory (BDT 225 crore in FY2026) and import-stage duties and VAT (BDT 231 crore) [1 p.182]; VAT and WPPF claims of BDT 1,089mn at the High Court, not provided [1 p.242], which we deduct at a 25% probability (BDT 8.6 a share); the BSEC related-party approval for Marico Middle East purchases [1 p.181]; and Bangladesh Bank's control of foreign-exchange payments, which governs how fast dividends and royalties reach India. No regulator caps MBL's dividend: unlike banks, it faces no Bangladesh Bank payout rule.

Five-year record: EPS up 16% a year, but the FY2026 gross margin fell 10 points to 49.4%

From FY2022 to FY2026 revenue grew from BDT 13.0bn to 20.7bn, a 12.3% annual rate, and EPS from BDT 112.82 to 206.09 (16.3% a year) [1 p.33] [1 p.189]. Two things lifted EPS faster than sales. FY2024 and FY2025 had a wide gross margin (58-60%) as copra was cheap. FY2025 also had BDT 875mn of finance income on cash held back while interim dividends paused in FY2024 [1 p.218]. In FY2026 the margin fell 10 points, and lower finance income and lower tax offset part of it.

Over five years the median gross margin was 54.3% and the median EBIT margin 37.0% [10]. Our FY2028F-29F margins (51.8% gross, 38.8% EBIT) sit at the median for EBIT and below it for gross. Lower advertising helps EBIT. ROE (printed 224% in FY2026 [1 p.34]) is not a useful anchor here: equity is almost all paid out each year.

Payout was 101% of FY2026 EPS and the treasury is spent: dividends now track earnings

Marico turns profit into cash. Operating cash flow was BDT 5.59bn in FY2026, 0.86x profit after the inventory build, and BDT 4.61bn (0.78x) in FY2025 [1 p.220]. Capex is small, BDT 231mn in FY2026, with only BDT 8mn of capital commitments at March 2026 [1 p.220] [1 p.242]. Almost all free cash goes out as dividends. Dividends paid were BDT 11.10bn in FY2026 and BDT 6.58bn in FY2025, funded partly by cashing BDT 8.2bn of fixed deposits [1 p.220]. Cash plus deposits fell from BDT 8.23bn to BDT 2.54bn, and NAV per share from BDT 239.13 to 92.02 [1 p.217] [1 p.241].

The payout record explains the drop. Marico paid 71% of FY2022 EPS and 61% of FY2023's. In FY2024 it paid only a 200% final (14%); the filings we read give no reason, and the 2023-24 dollar shortage is our inference. It caught up with 205% of FY2025 EPS and paid 101% of FY2026 [1 p.32] [1 p.181]. For FY2027 it has declared Tk 50 for the June quarter and Tk 35 for the half year [6]. With the treasury drawn down, future dividends can only track earnings. We use a 100% payout in the base and 90% in the bear case, giving DPS of BDT 211, 233 and 250 for FY2027F-29F [10].

Working capital is the other lever. Inventory days fell from 164 to 123 in FY2026, and payables fell to 21% of revenue. The June-quarter operating cash flow of BDT 639mn (0.37x profit) reflects copra stock building [2 p.10]. We keep inventory at 120-125 days.

We forecast EPS flat at BDT 211 in FY2027F and BDT 250 by FY2029F as copra eases

Our base has EPS of BDT 211.03 in FY2027F, flat on FY2026. It then rises to BDT 233.37 in FY2028F and BDT 250.37 in FY2029F [10]. FY2027F needs a second half of BDT 108, against BDT 95.57 a year earlier and BDT 102.82 in the first half [3 p.8]. The step is not a recovery assumption: second-half FY2026 was the copra trough, with a gross margin of 46.1% [1 p.218] [3 p.8], while our H2 FY2027F margin of about 50% matches H1 (50.3%) and Q2 (51.1%). Second-half revenue grows about 5% on the Q2 trends: Parachute +2.7%, VAHO -4.6%, Health & Beauty +36.6% [3 p.29]. Raw-material stock rose to BDT 4.66bn from 3.09bn (note 22.1.1 prints the opening and closing lines swapped; inventories total BDT 5.14bn) [3 p.29] [3 p.7], so we keep H2 materials slightly above H1. Line by line: revenue grows 4.9%, 8.8% and 8.3%. The gross margin is 50.1%, 51.8% and 52.0%. Marketing rebuilds from 4.5% to 6.0% of revenue, against 3.3% in the June quarter and 7.3% in FY2025 [2 p.29]. G&A excluding royalty grows 7% a year with salaries. Royalty and technical fees stay at 1.45% of revenue. Net finance income is about BDT 100mn in FY2027F (BDT 51mn in H1 [3 p.8]), as cash fell to BDT 819mn at September. FY2026's BDT 352mn one-off gain on securities does not recur [1 p.238]. The balance sheet follows: cash is the plug, inventory 120-125 days, payables 21% of revenue, and capex BDT 300mn against D&A of BDT 275-305mn.

Against the benchmarks: our FY2027F EPS is 6.4% versus the trailing 12 months (BDT 198.39 to Sep-2026) and 2.4% versus FY2026. Marico gives no guidance and runs no earnings calls in Bangladesh that we found, so there is no management guide to compare against.

Fair value BDT 1,926-3,930, base 3,016: 12.9x FY2028F EPS and a 7.7% yield

The valuation reads off the forecast. DCF (60%): free cash flow to the firm for FY2028F-34F is discounted at the cost of equity (there is no debt) to 31-Mar-2027. The EBIT margin is held at the FY2029F 38.6%. The tax rate rises to 20.5% and growth fades to 6.2%. Enterprise value is BDT 95.7bn, 61% of it from the terminal value. Add cash and deposits of BDT 2,498mn and deduct leases, staff obligations and 25% of the disputed claims. Add the FY2027 interims still to be paid (BDT 110 a share, including the Tk 35 declared on 29-Oct-2026), and discount 0.42 years to today: BDT 3,038. DDM (40%): FY2028F and FY2029F dividends, then growth of 6.2% at the same 13.9% cost of equity, give BDT 2,984. Sum of the parts does not apply: Marico has no subsidiaries (the subsidiary governance conditions are 'Not Applicable' [1 p.200]) and reports one business segment [1 p.242]. The DDM discounts each year's dividend at the fiscal year end although about three quarters is paid as interims during the year, so that leg is slightly conservative.

Inputs, set without reference to the price. ERP 7.5% is the skill's standard, used across this batch for non-bank DSE companies (BATBC, Square, Beximco, Walton). Beta follows the skill method used in the BATBC and BRAC Bank reports: measured two-year weekly beta, Blume-adjusted, floor 0.6. Terminal growth of 6.2% is derived, not picked: volume 1.0% (population and rural penetration in a category where Parachute already has ~80%) plus 0.5% mix (premiumisation, Health & Beauty), times price growth of 4.6%. That price growth is long-run inflation of 6.1%, taken from the 10-year bond yield of 9.27% [9] less an assumed 3% real yield, minus 1.5 points because volume fell when Marico raised prices in FY2026-27 [2 p.28]. The result is inside the F08 staples range (5-7%) and below Marico's own revenue growth of 13.1% a year from FY2019 to FY2026 [5 p.26] [1 p.189], which price rises, the Mirsarai plant and new categories lifted. The DCF at 5%, 6% and 7% growth is BDT 2,732, 2,992 and 3,326 (Exhibit 26 shows the full grid). With these inputs the base of BDT 3,016 lands above the price of BDT 2,642.5, which sits between our bear and base values.

Cost of equity = 10-year T-bond 9.27% [9] + beta 0.62 x ERP 7.5%. The raw two-year weekly beta against DSEX is 0.43 (correlation 0.46) [7]. That is low because the parent owns 90% and the float trades thinly. Blume-adjusted it is 0.62, just above the 0.6 floor. We use the same beta in every scenario, so scenarios change operating drivers only.

Multiples as cross-checks, not anchors. At ~100% payout a justified forward P/E is payout / (CoE - g) = 12.9x. Our base is 14.3x FY2027F and 12.9x FY2028F EPS, with a 7.7% FY2028F dividend yield. MARICO's own pre-floor median trailing P/E (FY2019-FY2022) was 21.0x [5 p.27] [7]. That was when EPS grew 15-20% a year, the payout was 60-70% and the 10-year bond yielded far less. At our 13.9% cost of equity, a 21x trailing P/E with full payout implies perpetual growth of about 9%, above Bangladesh's long-run nominal consumer growth, so we do not use it. The median of the other four multinational subsidiaries (24.2x, skewed by Unilever at 71x) is not comparable either [8]. The reverse DCF says the price needs 4.6% perpetual growth.

Risks: copra +15% cuts fair value 23%; a 2% royalty or lost tax holiday cut it 2-3%

Each risk below is a change to one driver in the model, with everything else at base. Copra is the largest: a 15% rise not passed on cuts FY2028F EPS to BDT 185 and fair value by 23%. A higher royalty is a governance risk. It was 0.95% in FY2026; at 2% fair value falls to BDT 2,934. Other risks without a modelled number: a BSEC or Bangladesh Bank change that slows remittance (in FY2024 dividends were cut to 14% of EPS); parent decisions on sourcing through Marico Middle East (related-party pricing); the VAT/WPPF claims of BDT 1,089mn [1 p.242]; and a management handover in February 2027 [6].

FAQ

What is Marico Bangladesh's fair value?

We estimate BDT 1,926-3,930 a share, base 3,016, from a DCF (60%) and a dividend discount model (40%) at a 13.9% cost of equity [10]. The price on 29-Oct-2026 was BDT 2,642.5 [7].

Why did Marico's margin fall in FY2026?

Copra and coconut-oil prices rose: materials went from 36.9% to 47.8% of revenue and gross margin from 59.7% to 49.4% [1 p.188] [10].

How much does Marico pay its Indian parent?

In FY2026 a royalty of BDT 197.5mn and a technical fee of BDT 103.1mn (together about 1.45% of revenue), plus BDT 9.99bn of dividends remitted net of tax [1 p.237] [1 p.242].

What dividend does Marico pay?

BDT 207.5 a share for FY2026 (2,075%), 101% of EPS; for FY2027 it has declared Tk 50 and Tk 35 interims so far [1 p.181] [6].

Which results does this report use?

The annual report to 31-Mar-2026 and the audited half-year statements to 30-Sep-2026. We will update the model when the Q3 FY2027 statements are filed.

Does Marico run earnings calls?

We found no public earnings call or investor presentation by Marico Bangladesh; management commentary comes from the annual report and DSE releases.

Sources

1. Marico Bangladesh Limited Annual Report 2025-26 (year to 31-Mar-2026) · link · accessed 2026-10-31
2. Marico Bangladesh audited financial statements, three months to 30-Jun-2026 (Q1 FY2027) · link · accessed 2026-10-31
3. Marico Bangladesh audited financial statements, six months to 30-Sep-2026 (H1 FY2027) · link · accessed 2026-10-31
4. Marico Bangladesh Limited Annual Report 2024-25 (year to 31-Mar-2025) · link · accessed 2026-10-31
5. Marico Bangladesh Limited Annual Report 2022-23 (five-year highlights FY2019-FY2023) · link · accessed 2026-10-31
6. DSE announcements for MARICO, Nov-2024 to Oct-2026 (Q2 FY2027 results and Tk35 interim 29-Oct-2026; Q1 results and Tk50 interim 30-Jul-2026; FY2026 final dividend 30-Apr-2026; quarterly EPS releases; MD succession 29-Oct-2026) and DSE company page shareholding at 30-Sep-2026 · link · accessed 2026-10-31
7. AnalystBro price data (TradingView feed): DSE:MARICO daily, weekly and monthly bars, DSEX weekly, to 29-Oct-2026 · link · accessed 2026-10-31
8. AnalystBro screener: MARICO and DSE multinational consumer peers, close 29-Oct-2026 · link · accessed 2026-10-31
9. Bangladesh Bank, Treasury auction cut-off yields (10-year bond 9.268% on 25-Oct-2026; 364-day bill 8.79% on 26-Oct-2026) · link · accessed 2026-10-31
10. AnalystBro model for this report (workbook tabs below) · link · accessed 2026-10-31
11. The Business Standard, 20-Sep-2026: Foreign investors offload Tk85cr Marico shares in six months · link · accessed 2026-10-31
12. The Daily Star, 28-Jan-2025: Marico secures handsome profit growth with higher sales · link · accessed 2026-10-31
13. The Business Standard, 20-Oct-2022: How local brands selling coconut oil in tins lose market to plastic bottles · link · accessed 2026-10-31