Accumulate Dabur India target of Rs 599: East India Securities

East India Securitie's report on Dabur India

International business was at Rs 7318mn and saw a growth of 12% yoy in Constant Currency (CC) terms and 0.6% yoy in INR terms. Domestic business saw a 7.4%yoy growth. Domestic business performance was : Health Care saw a decline of 1.5% yoy; Health supplements registered decline of 9.1% yoy , digestives registered 16% yoy growth, glucose grew by 9.3% yoy. Chyawanprash saw 138bps increase in market share. HPC (Home & Personal Care) saw growth of 8.7% yoy, the various categories performed thus: Home Care 7.5% yoy growth; double digit growth for Odomos, which also saw a 600bps increase in market share. Oral care grew by 22% yoy. Hair oils saw 2.5% decline yoy; market share for hair oils portfolio improved by 115 bps. Food & beverages saw a flat growth yoy. Gross margins have expanded by 280bps yoy. Ad-spends are up 21.1% yoy to 6.5% of sales.

Outlook

Dabur is currently trading at P/E of 40.2x on FY26 basis. We value the stock based on P/E methodology and assign multiple of 45x on FY26E PAT of Rs 23,584mn to arrive at a target price of Rs599 per share, which is a potential upside of 12.8% from current market price and recommend “Accumulate” on the stock.

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