Sharekhan's research report on Colgate-Palmolive (India)
For Q1FY2024, Colgate Palmolive (India) Limited (Colgate) reported a strong beat on our as well as street expectations, with revenue/PAT growing by ~11%/31% y-o-y, driven by 12% growth in the domestic business. Volume growth in the toothpaste category stood at ~7%, better than street as well as our expectation of 3-4%. Revenue reported a muted CAGR of low single-digit over FY2016-FY2023. Revamped strategies under the new leadership have started showing good results, with double-digit growth in the domestic market. Sustenance of the same will be keenly monitored.
Outlook
We upgrade our rating on the stock to Hold with a revised PT of Rs. 2,080 and will keenly monitor the performance in the quarters ahead. The stock is currently trading at 42x/39x its FY2024E/FY2025E earnings.
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