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BAJAJ CORP
Key takeaways
Demand conditions are robust; the company expects double-digit volume growth in
FY2012E. It has taken 8.5% price hike in Almond Drops in April 2011. If LLPO continues
to remain inflationary, the company would consider further price hikes. Any correction in
input costs has the potential for margin expansion as in its history, it has never taken a
price cut (as the product has a premium positioning).
Kailash Parbat cooling oil launched four months back is available in 0.2 mn outlets against
Emami’s Navratna (market leader) which is available in 2.7 mn outlets. In few states such
as Rajasthan and Madhya Pradesh, Kailash Parbat is more widely distributed than
Navratna. Kailash Parbat has market share of 7.6% and 2.4%, respectively in these states.
Kailash Parbat will break even on reaching sales of Rs360 mn (6% market share). In
FY2011, Emami spent ~Rs200 mn on Navratna, and Bajaj Corp would spend at least half
of that to take competition head on.
The company is pursuing M&A opportunities in India and overseas. It has hired Mr. Jimmy
Anklesaria (earlier with Godrej Consumer) to oversee the process.
India Equity Research Reports, IPO and Stock News
Visit http://indiaer.blogspot.com/ for complete details �� ��
BAJAJ CORP
Key takeaways
Demand conditions are robust; the company expects double-digit volume growth in
FY2012E. It has taken 8.5% price hike in Almond Drops in April 2011. If LLPO continues
to remain inflationary, the company would consider further price hikes. Any correction in
input costs has the potential for margin expansion as in its history, it has never taken a
price cut (as the product has a premium positioning).
Kailash Parbat cooling oil launched four months back is available in 0.2 mn outlets against
Emami’s Navratna (market leader) which is available in 2.7 mn outlets. In few states such
as Rajasthan and Madhya Pradesh, Kailash Parbat is more widely distributed than
Navratna. Kailash Parbat has market share of 7.6% and 2.4%, respectively in these states.
Kailash Parbat will break even on reaching sales of Rs360 mn (6% market share). In
FY2011, Emami spent ~Rs200 mn on Navratna, and Bajaj Corp would spend at least half
of that to take competition head on.
The company is pursuing M&A opportunities in India and overseas. It has hired Mr. Jimmy
Anklesaria (earlier with Godrej Consumer) to oversee the process.
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