FMCG :Q4FY12 RESULTS PREVIEW :Kotak Securities PDF link

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http://www.kotaksecurities.com/pdf/dmb/MorningInsight10042012.pdf

FMCG
We expect strong performance from all FMCG companies under our
coverage. We factor in 10-12% organic growth in sales, on account of
continued improvements in pricing as well as volumes. We believe
companies under our coverage universe shall broadly be able to pass on rise
in raw material prices/ compensate for declining gross margins with other
efficiencies, leading to stable/ growing margins (y/y). We see 17% growth
in revenues and 26% in PAT in our coverage companies.
 Godrej Consumer: We have factored for a 25% y/y growth in revenues, even
as we expect some cool-off in growth in domestic as well as international operations (4QFY12 revenues are expected to be lower by 7% on a sequential basis).
Expect EBITDA margins to remain flat q/q, as improving domestic margins are
likely to offset declines in international operations, which came in strongly in
3QFY12. Expect PAT to grow 16% y/y.
 HUL: We expect 14% growth y/y in HUL's revenues, as pricing improves and
volumes continue to display growth. Expect EBITDA margins will expand 250 bps
y/y, on account of improving gross margins (better pricing), and continued efficiencies in advertising and promotional spends. Expect PAT growth of 32% y/y
on stronger margins and revenue growth.
 ITC: We expect 13%-14% growth in cigarette (gross) revenues on account of
higher pricing. Expect strength in EBITDA margins (6.4 ppt rise y/y) on account of
stronger margins in cigarettes; as well as continued move towards profitability in
the other FMCG segment. We estimate 31% growth in the company's EPS.