ICICI Securities research report on EPL
EPL’s Q1FY25 print had multiple positive trends: 1) Market share win in oral care segment, which has been stable for few years, driven by sustainable tubes. 2) Pricing reduction at tail-end with revenue growth reflecting underlying performance. 3) More customers added in Brazil, which will likely help Americas to sustain high growth rate. 4) Europe margin showing smart improvement. Finally, EPL has started delivering consistent performance with broad-based double-digit revenue growth and EBITDA close to guidance of 20%. The only miss was slower-than-expected revenue growth in the personal care segment.
Outlook
We tweak our EPS estimates by ~1% for FY25/FY26. However, our target price increases to INR 275 (earlier INR 225), as we raise our FY26E P/E multiple to 22x (from 18x). Maintain BUY.
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