Hold Emami target of Rs 240: Sharekhan
Sharekhan recommended Hold rating on Emami with a target price of Rs 240 in its research report dated June 30, 2020.
July 02, 2020 / 04:45 PM IST
Sharekhan's research report on Emami
Consolidated revenue declined by ~17% (led by 19% decline in the domestic business, summer products pipeline filling with dealers/distributors affected by lockdown in the last 10 days of the quarter. Gross margin improved by 436 bps due to benign raw-material costs; OPM declined by 569 bps mainly on account lower operating leverage. Capacity utilisation in most of the plants is near normalcy; Zandu and pain management portfolio are gaining strong traction; focus on revamping growth prospects in men's fairness cream, and other key products. Gross margin benefits to sustain in the near term.
Reduction in significant promoters’ pledging will be a key re-rating trigger for the stock; maintain Hold with a revised PT of Rs. 240.
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