Accumulate Marico; target of Rs 170: PLilladher

11362 Investors following Marico. Share this News with them.

0

Like this story, share it with millions of investors on M3

Accumulate Marico; target of Rs 170: PLilladher

Prabhudas Lilladher is bullish on Marico and has recommended accumulate rating on the stock with a target of Rs 170 in its February 2, 2012 research report.

Post your opinion here

 

0

Tweet

Share on Tumblr

RELATED NEWS Accumulate Coal India; target of Rs 390: PLilladher Accumulate Indraprastha Gas; tgt of Rs 397: Arihant capital Buy Noida Toll: PPFAS Research ALSO READ See previous views by Prabhudas Lilladher See what other Experts & Brokerages are saying about Marico See messages about Marico Marico BSE | NSE 30/05/12 Are Mutual Funds betting on Marico?

Prabhudas Lilladher is bullish on Marico and has recommended accumulate rating on the stock with a target of Rs 170 in its February 2, 2012 research report.

"Marico reported strong operational Q3Y12 performance, with 16% domestic volume growth (13% overall) and 300bps gross margin expansion being the key highlights. Notwithstanding the price hikes in its core brands and general inflationary headwinds to consumer wallets, volume growth of 16% reinforces MRCO's dominant brand franchise. Sales, EBITDA and PAT came in at Rs10.56bn (up 29% YoY), Rs1.22bn (up 22.1% YoY) and Rs841m (up 21%YoY), against our expectations of Rs10bn, Rs1.19bn and Rs810m, respectively. Recurring PAT adjusted for exceptional grew solid 25%. Parachute, Saffola and Value-added hair oils posted 13%, 15% and 2% volume growth, while Kaya reported 15% same store clinic growth. International division delivered 16% organic revenue growth."

"With high RM in the base and softening in Copra (down 9% QoQ), standalone as well as consol gross margins expanded 300bps (consol gross margins up 120bps YoY). Like to like EBITDA margins (adjusting for Rs96m as excise provisioning in Q3FY11) contracted ~200bps driven by higher ad-spends (up170bps). Current quarter also contains a charge of Rs129m in Kaya Middle East, pertaining to misstatement of expenses related to earlier years, thus, resulting in consequent overstatement of Kaya profitability in the relevant period. As per the management, appropriate action has been taken for this lapse and monitoring process has been further strengthened."

"MRCO's continued strong volume driven performance, despite the aggressive price hikes (taken in 2HFY11) and turn-around in RM dynamics, creates a good tailwind for EPS upgrades, going forward. However, current valuations at 23.6x FY13e is fair, in our view. Maintain 'Accumulate', with a revised Mar-13 TP of Rs170," says Prabhudas Lilladher research report.     

Non-Institutions holding more than 90% in Indian cos

Disclaimer: The views and investment tips expressed by investment experts/broking houses/rating agencies on moneycontrol.com are their own, and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.

To read the full report click on the attachment