1. Is Godrej Consumer Products stocks safe bet after Q4 results?

Is Godrej Consumer Products stocks safe bet after Q4 results?

FMCG firm Godrej Consumer Products Ltd (GCPL) posted over three-fold jump in consolidated net profit of Rs 389.91 crore for the fourth quarter as compared to Rs 124.84 crore in the January-March quarter a year-ago.

By: | Published: May 10, 2017 1:03 PM
Godrej Consumer Products Ltd, home category, Good Knight, SAARC, Sunil Kataria, Malaria, EMBED FMCG firm Godrej Consumer Products Ltd (GCPL) posted over three-fold jump in consolidated net profit of Rs 389.91 crore for the fourth quarter as compared to Rs 124.84 crore in the January-March quarter a year-ago.

FMCG firm Godrej Consumer Products Ltd (GCPL) announced its fourth quarter results on Tuesday and posted over three-fold jump in consolidated net profit of Rs 389.91 crore as compared to Rs 124.84 crore in the January-March quarter a year-ago. Reacting to the results, the share price of the company zoomed 9.74 per cent to settle at Rs 1,929.25 on BSE on Tuesday. The share price surged 9.98 per cent to end at Rs 1,929.40 on Tuesday.

On Wednesday, the share price of the company was trading 0.65 per cent up at Rs 1941.80 at 12.41 am.

The company on Tuesday also announced the appointment of Nisaba Godrej as the executive chairperson of the company. Adi Godrej, 75, will become Chairman Emeritus after
leading the company for 17 years.

Brokerage House Edelweiss, which reommends a ‘Buy’ rating on the stocks with target price of Rs 1,929, bets on the company’s sharp focus on innovation and cost efficiency. It further added that GCPL’s Africa business growth is encouraging.

“Godrej Consumer Products’ (GCPL) 12.1% YoY revenue growth came in line with our estimate, while EBITDA & adjusted PAT (up 20.8% YoY and 25.3% YoY, respectively) surpassed it. In our under coverage consumer pack, GCPL is the only company in Q4FY17 to report double digit sales spurt helped by successful innovations and strong recovery in hair colour—while India business sales jumped 10% YoY with 5% YoY volume growth, international sales grew 16% YoY. Consolidated EBITDA margin jumped 165bps YoY; standalone business EBITDA margin expanded 232bps YoY without resorting to cut in ad spends (unlike peers). GCPL has declared bonus issue in the 1:1 ratio,” Edelweiss while analysing company’s fourth quarter results said.

With the help of Edelweiss, we look at the growth company has shown on various parametres

1. Robust 13% YoY sales spurt in hair care post 2 quarters of negative or nil growth (2% YoY dip in Q3FY17)
2. 9% YoY growth in personal wash led by mid single digit volumes, post 2 consecutive quarters of sales dip
3. 23% YoY sales surge in other brands (air fresheners, Cinthol deos, liquid detergents etc)
4. 313bps YoY and 267bps YoY jump in standalone and consolidated gross margins
5. 61% YoY CCG in Africa and 19% YoY CCG in LATAM

  1. D
    Dhaval Shah
    May 10, 2017 at 4:17 pm
    Only Markets Guruji( ) had given the correct prediction about S chand IPO and NSE IPO on his channel rest all failed , just watch his videos its unbelivable, his analysis was perfect, must watch for all investors.
    Reply

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