Accumulate Colgate; target of Rs 939:Prabhudas Lilladher

Trade

• Watchlist
• Portfolio
• Message
• Set Alert

 

 

Choose Stock Exchange: BSE LIVE NSE LIVE

26 Aug, 2025 12:21

Volume

Todays L/H

More

×

Prabhudas Lilladher's research report on Colgate We are cutting FY16, FY17 and FY18 EPS estimates of CLGT by 4‐10% following subdued performance in Q3FY16. CLGT has reported flat volumes in Toothpaste and 30bps QoQ loss in market share in slowing market (2‐2.5% volume growth in CY15 as per Nielsen). Although Chennai floods and inventory destocking impacted volumes to the extent of 1%, rising competition from ‘Patanjali Ayurved’ is one of the key reasons for slow growth, more so in North India. Although CLGT is sustaining its innovations like Active salt Neem, Total Charcoal, Pro Sensitive enamel repair and Sugar Acid neutraliser, a shift towards herbal segment is a medium‐term threat. We expect tepid recovery and lower volume growth estimates to 3.5% (7.5% earlier) and 5.0% (8.5% earlier) for FY17 and FY18. We estimate 5% PAT growth in FY16 (excise and tax rate impact and excluding tax write back benefit) and 15% PAT CAGR over FY16‐18. We retain “Accumulate”. Toothpaste volumes were flat in Q3; volume growth would have been 1% excluding the impact of Chennai floods and inventory de‐stocking. Overall volumes were up 1% (3% in Q2). Industry volumes have increased by 2‐2.5% during CY15. Toothpaste market share has declined by 30bps QoQ at 57.3% (Jan‐Dec’15), second consecutive quarter of loss in market share. While the growth is impacted by slow demand in rural India, inroads by Patanjali Ayurved has been one of the key contributors to lower growth. For all recommendations, click here 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.

Read More