Sharekhan's research report on Jyothy Labs
Jyothy Labs Limited’s Q4FY2022 operating performance was in-line with our expectation. Revenue grew ~10% to Rs. 546.7 crore, while OPM fell 180 bps to 12.5%; PAT grew 8.0% y-o-y to Rs. 48 crore (led by lower incidence of tax). All key categories except household insecticides registered double-digit growth in Q4. Fabric care, dishwashing, and personal products grew 18%, 12%, and 12%, respectively. Management is focusing on achieving double-digit revenue growth through market share gains, category development, and distribution expansion in the medium term. OPM would recover to 15-16% once raw-material inflation cools off.
The stock is currently trading at discounted valuation of 22.6x/17.5x its FY2023E/FY2024E EPS. We maintain Buy with a revised PT of Rs. 175.
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