FMCG :: Q3FY12 RESULTS PREVIEW: Kotak Securities

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FMCG
n Godrej Consumer: We estimate Rs 12960 mn in revenues in 3QFY12, including
Rs 1100 mn from the acquisition of the Darling Group. Excluding the Darling
Group acquisition, we expect sales to register growth of 21%, on the back of
continued benefits of enhanced distribution, and launch of new products. We estimate
EBITDA margins of 19%, on the back of stability in gross margins (q/
q)and rationalization in advertising and distribution spends. Interest expenses are
set to rise on account of the Darling acquisition. PAT growth is estimated at 26%
y/y.
n ITC Ltd: We expect cigarette revenues to continue registering high growth
(15%, likely 6-7% growth in volumes), leading to 14.5% y/y growth in revenues
for the quarter. Expect further improvement in cigarette margins on account of
improved pricing (Navy Cut price hikes, affected August, are likely to have an
impact in the quarter). We expect the improvement in other FMCG margins to
continue. EBITDA Margin for the company is estimated at 37.3%, a minor improvement
of 0.1 ppt. We expect PAT growth of 14% y/y for 3QFY12.