The FMCG major Godrej Consumer Products’ share price rose 2.4% to the day’s high of Rs 1,187.90 after Nuvama retained its Buy rating on the stock following a pre-quarterly business update. The stock is now almost 23% away from its 52-week high of Rs 1,541.85.
Nuvama on Godrej Consumer Products: Business update in line with expectations
The brokerage firm Nuvama said that the company’s business update was as per its estimates. It believes that Indian business’ value shall rise by 8.5% year-on-year while domestic volume to grow 5% YoY (versus our initial estimate of 3–4%). The domestic markets’ EBITDA margins of 22% came as per expectations.
Also, the Home Care segments’ volume might see an uptick of 14% YoY aided by a revival in HI (likely 10% growth YoY on a soft base against a sharp dip in Q3 FY25).
Following the business update, Nuvama maintained its Buy rating on the stock with a target price of Rs 1,460.
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The company said the management’s focus for the March quarter remained on reviving the standalone underlying volume growth (UVG) trajectory. The company will also focus on holding the standalone EBITDA margin despite cost pressure and maintaining the trajectory in the international business. “We remain largely on track to achieve across all the stated objectives,” read an exchange filing.
However, GCPL didn’t mention any numbers, but expects UVG to grow in mid-single digits and revenue in “high single digits”. The same has been driven by a “mid-teens UVG in-home care” and a “mid-single digit decline in personal care”.
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The company reported a 14.2% YoY drop in its consolidated net profit for Q3 FY25 at Rs 498.31 crore, compared to Rs 581.06 crore posted in the same period last year.
Godrej Consumer’s stock performance
The share price of GCPL has risen 4% in the last five trading days. The stock has given a return of 14% in the past one month. However, the stock price has fallen 9% in the last six months. The share price of the FMCG giant has declined 5% in the last one year.
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