MOSL: DABUR (Neutral)-Earnings in line-Growth prospects muted
DABUR: Earnings in line; Growth prospects muted
(DABUR IN, Mkt Cap USD12.0b, CMP INR482, TP INR455, 6% Downside, Neutral)
** 2QFY20 consolidated sales grew 4.1% YoY to INR22.1b (v/s est. INR22.4b). EBITDA grew 8.6% YoY to INR4.9b (v/s est. INR4.8b). PBT grew 6% YoY to INR5b (v/s est. INR5b). Adj. PAT increased 15.5% YoY to INR4.4b (v/s est. INR3.9b). Domestic FMCG business grew 4.9% with underlying volume growth of 4.8% (v/s est. +4%).
** Gross margin expanded 140bp YoY to 50.8%. Along with lower staff costs as a % of sales (down 10bp YoY to 10.9%), higher ad spends (up 20bp YoY to 6.5%) and higher other expenses (up 40bp YoY to 11.2%), translated to consol. EBITDA margin expanding 90bp YoY to 22.1%.
** 1HFY20 consol. sales/ EBITDA/ Adj. PAT grew 6.6%/ 13.2%/ 15.3% YoY.
Dabur India is engaged in manufacturing, marketing and distributing consumer goods and its related products. Co.'s products include hair care, oral care, health supplements, digestives and candies, baby and skin care, fruit juices, cooking pastes and sauces. Co.'s brand names include Dabur, Asavs, Classicals, Dabur Shilajit, Naturecare, Shankhpushpi, Honitus and Ring Ring. Co. operates three business divisions: Consumer Care Division, Consumer Healthcare Division and the wholly owned subsidiary, Dabur Foods Limited.
Motilal Oswal Financial Services Ltd. is a reputed name in Financial Services and Online Trading with group companies providing services such as Private Wealth Management, Retail Broking and Distribution, Institutional Broking, Asset Management, Investment Banking, Private Equity, Commodity Broking, Currency Broking, Principal Strategies & Home Finance.
Motilal Oswal Securities is a group company of Motilal Oswal Financial Service Limited which started as a stock trading company and has blossomed into well diversified firm offering a range of financial products and services. Motilal Oswal has built a reputation as the source for best stock trading company and this has taken a wealth of experience, knowledge and expertise, constantly working in tandem, over the years.
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