DOMS Industries: JM Financial sees 13% upside on this pencil-maker stock post Q2 earnings
Consolidated revenue jumped 24.1 per cent year-on-year (YoY) to Rs 570 crore, exceeding both the brokerage and street estimates by 3–4 per cent. This strong topline performance came despite a GST-led transition impact during the quarter.
- Nov 11, 2025,
- Updated Nov 11, 2025 11:52 AM IST
DOMS Industries, the stationery and pencil maker, delivered a strong set of numbers for the second quarter of FY26, outperforming market expectations on both revenue and profit fronts. Riding on the strong performance, brokerage firm JM Financial has reiterated its ‘Add’ rating on the stock with a revised target price of Rs 2,875 — implying an upside potential of 13.4 per cent from the current market levels.
The company’s Q2FY26 earnings print was better than our expectations both on revenue and profitability, JM Financial noted. Consolidated revenue jumped 24.1 per cent year-on-year (YoY) to Rs 570 crore, exceeding both the brokerage and street estimates by 3–4 per cent. This strong topline performance came despite a GST-led transition impact during the quarter.
Profitability too outpaced forecasts, with Profit After Tax (PAT) rising 13.5 per cent YoY to Rs 58.3 crore — about 11 per cent higher than estimates. EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization) grew 15.8 per cent YoY to Rs 99.5 crore, reflecting continued operating strength.
DOMS’ core stationery segment continued to anchor growth, posting a steady 17.4 per cent YoY increase. While traditional categories like scholastic stationery and art materials were somewhat muted, the brokerage attributed this to "capacity constraints" and a growing consumer shift towards kits & combos.
This shift was evident in gross sales trends across categories: Kits & Combos: +41 per cent YoY, Office Supplies: +84 per cent YoY, Hobby & Craft: Grew 3.8x YoY.
In addition, the company’s newly acquired hygiene business, Uniclan, recorded a 3.3x YoY surge in sales — though on a low base, as the year-ago quarter had only 14 days of consolidation. Exports, too, remained a bright spot, rising around 18 per cent YoY.
DOMS delivered a modest improvement in margins, with gross margin expanding by 39 basis points (bps) YoY to 43.8 per cent. However, the gains were partly offset by higher costs. The brokerage highlighted that "elevated staff cost" (+32.6 per cent YoY) and "other expenses" (+32 per cent YoY) resulted in a 125 bps YoY contraction in consolidated EBITDA margin to 17.5 per cent.
Notably, the core stationery segment sustained its strong profitability profile, maintaining an EBITDA margin of 19.6 per cent.
Looking ahead, JM Financial maintained an upbeat stance on the company’s growth trajectory. The note said DOMS is "well placed to achieve higher end of its consol. sales growth guidance of 18–20 per cent" for FY26. The brokerage flagged the "pace of commissioning of new capacities in writing instruments" and "sustained execution on paper stationery & Uniclan business" as key factors to watch in the coming quarters.
DOMS Industries, the stationery and pencil maker, delivered a strong set of numbers for the second quarter of FY26, outperforming market expectations on both revenue and profit fronts. Riding on the strong performance, brokerage firm JM Financial has reiterated its ‘Add’ rating on the stock with a revised target price of Rs 2,875 — implying an upside potential of 13.4 per cent from the current market levels.
The company’s Q2FY26 earnings print was better than our expectations both on revenue and profitability, JM Financial noted. Consolidated revenue jumped 24.1 per cent year-on-year (YoY) to Rs 570 crore, exceeding both the brokerage and street estimates by 3–4 per cent. This strong topline performance came despite a GST-led transition impact during the quarter.
Profitability too outpaced forecasts, with Profit After Tax (PAT) rising 13.5 per cent YoY to Rs 58.3 crore — about 11 per cent higher than estimates. EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization) grew 15.8 per cent YoY to Rs 99.5 crore, reflecting continued operating strength.
DOMS’ core stationery segment continued to anchor growth, posting a steady 17.4 per cent YoY increase. While traditional categories like scholastic stationery and art materials were somewhat muted, the brokerage attributed this to "capacity constraints" and a growing consumer shift towards kits & combos.
This shift was evident in gross sales trends across categories: Kits & Combos: +41 per cent YoY, Office Supplies: +84 per cent YoY, Hobby & Craft: Grew 3.8x YoY.
In addition, the company’s newly acquired hygiene business, Uniclan, recorded a 3.3x YoY surge in sales — though on a low base, as the year-ago quarter had only 14 days of consolidation. Exports, too, remained a bright spot, rising around 18 per cent YoY.
DOMS delivered a modest improvement in margins, with gross margin expanding by 39 basis points (bps) YoY to 43.8 per cent. However, the gains were partly offset by higher costs. The brokerage highlighted that "elevated staff cost" (+32.6 per cent YoY) and "other expenses" (+32 per cent YoY) resulted in a 125 bps YoY contraction in consolidated EBITDA margin to 17.5 per cent.
Notably, the core stationery segment sustained its strong profitability profile, maintaining an EBITDA margin of 19.6 per cent.
Looking ahead, JM Financial maintained an upbeat stance on the company’s growth trajectory. The note said DOMS is "well placed to achieve higher end of its consol. sales growth guidance of 18–20 per cent" for FY26. The brokerage flagged the "pace of commissioning of new capacities in writing instruments" and "sustained execution on paper stationery & Uniclan business" as key factors to watch in the coming quarters.