MOSL: GODREJ CONSUMER (Neutral)-Domestic branded volumes grow 5% led by Hair color portfolio
​Godrej Consumer: Domestic branded volumes grow 5% led by Hair color portfolio
(GCPL IN, Mkt Cap USD9.9b, CMP INR1929, TP INR1950, 1% Upside, Neutral)
- Godrej Consumer’s (GCPL) 4QFY17 consol. net sales grew 11.8% YoY to INR23.8b (est. of INR24.5b). Consol. EBITDA growth of 19.5% YoY to INR5.4b (est. of INR5.04b) and adj. PAT growth of 21.4% YoY to INR3.83b (est. of INR3.4b) were both better than expectations. Organic consol. CC sales grew 6% YoY, while India business sales were up strongly by 10% YoY in 4QFY17.
- Gross margin expanded 260bp YoY to 56.6%. Ad spend to sales declined 70bp YoY to 6.5%, but the fall was not as steep as witnessed by peers for the quarter. EBITDA margin expanded 150bp YoY to 22.7% in 4QFY17. Consol. EBITDA grew 19.5% YoY to INR5.4b (est. of INR5.04b). Thus, despite consol. sales being 2.6% below expectations, EBITDA was 7.4% ahead of forecasts. Higher-than-expected other income and a lower-than-forecast tax rate led to PAT beat of 12.5%. Adj. PAT grew 21.4% YoY to INR3.83b (est. of INR3.4b).
- India branded business volume growth stood at 5% YoY. Household Insecticides business reported 4% YoY sales growth, Soaps grew 9% YoY, while Hair color sales were up 13% YoY (double-digit revenue growth in Hair colors after five quarters).
- International: CC sales grew 22% YoY (with 1% organic sales growth). On CC basis, Indonesia sales were flat, Africa/LatAM grew 61%/19%, while Europe sales declined 5%.
- FY17 performance: Consol. sales, EBITDA and adj. PAT growth stood at 9.7%, 16.2% and 12.3%, respectively.
Godrej Consumer Products is a consumer goods company, manufacturing and marketing Household and Personal Care products. Co. is engaged in the manufacture and sale of soaps, cosmetics and detergents. Co.'s Personal Care products include Godrej No.1 - soaps; Cinthol - soaps, deodorants, talcs and shower gels; Godrej protekt - washes, a hand sanitiser and a personal mosquito repellent spray; and Godrej expert - creme hair colour in a sachet, powder hair colour with a unique gel technology, and herbal hair colour. Co.'s home care products include Good Knight - mosquito repellents; HIT - household insecticides; Godrej aer - home and car air fresheners; and Godrej Ezee - liquid detergents.
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.
Unfortunately, this report is not available for the investor type or country you selected.
Browse all ResearchPool reportsReport is subscription only.
Thank you, your report is ready.
Thank you, your report is ready.