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Still the steadiest ship; we remain positive. Dabur reported a broadly in-line 3QFY15 despite minor disappointments in the acquired Namaste business. The company’s diversified portfolio and solid in-market execution continue to drive ahead-of-themarket volume growth. We expect strong earnings growth ahead on the back of steady double-digit topline growth and RM-weakness-led margin expansion. Reiterate our ADD rating with a revised target price of `280 (`260 earlier).
�� India Equity Research Reports, IPO and Stock News Visit http://indiaer.blogspot.com/ for complete details ��
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3QFY15 – domestic business in line, international disappoints a tad Dabur’s standalone 3QFY15 financials were in line with our expectations on most fronts while consolidated financials were marginally below expectations on account of weakness in the Namaste business and higher-than-expected currency translation impact. Dabur’s steady performance stands out in the backdrop of the massive disappointment we have seen on 3QFY15 earnings reports in the sector so far. Consolidated financials – revenues were up 9% yoy to `20.74 bn, 2% below expectations while EBITDA grew a healthy 18% yoy to `3.46 bn. EBITDA margin expanded 134 bps yoy to 16.7%, broadly in line with our expectations. Reported net profit of `2.83 bn (+16% yoy) was broadly in line with our estimated `2.87 bn. For 9MFY15, Dabur has reported revenue, EBITDA and PAT growth of 11%, 13% and 15% respectively. Standalone financials – revenues grew 12% yoy to `15 bn, in line with our estimate while EBITDA grew a strong 19% yoy to `2.6 bn, again in line. EBITDA margins expanded 107 bps yoy to 17.3% on the back of 111 bps expansion in gross margins. Gross margin expansion was led partly by better revenue mix (lower growth in foods). Benefits of RM correction are yet to show up in gross margin expansion. Standalone PAT grew 19% yoy to `2.17 bn, marginally ahead of our expectations. We like what we see and expect FY2016E to be a year of strong EPS growth Dabur has delivered healthy, ahead-of-the-market volume growth for the past many quarters in a challenging demand backdrop. The company’s diversified portfolio, low dependence on premiumization for growth, and superior in-market execution have all helped, in our view. We expect robust relative volume momentum to continue even as the absolute levels would depend on the growth trajectory of the broader economy. Most importantly, we expect Dabur to retain a good portion of RM-correction-led gross margin benefits as the company’s dominant position will likely enable it to hold on to prices in a few categories. The company would sure reinvest a portion of the benefit on A&P; however, the already-high relative A&P levels would aid flow-through of a good portion of GM benefits to the EBITDA level. We forecast 22% EPS growth CARG over FY2015-17E. ADD rating stays with a revised target price of `280 (`260 earlier).
LINK
http://www.kotaksecurities.com/pdf/indiadaily/indiadaily02022015ka.pdf
Still the steadiest ship; we remain positive. Dabur reported a broadly in-line 3QFY15 despite minor disappointments in the acquired Namaste business. The company’s diversified portfolio and solid in-market execution continue to drive ahead-of-themarket volume growth. We expect strong earnings growth ahead on the back of steady double-digit topline growth and RM-weakness-led margin expansion. Reiterate our ADD rating with a revised target price of `280 (`260 earlier).
�� India Equity Research Reports, IPO and Stock News Visit http://indiaer.blogspot.com/ for complete details ��
��
3QFY15 – domestic business in line, international disappoints a tad Dabur’s standalone 3QFY15 financials were in line with our expectations on most fronts while consolidated financials were marginally below expectations on account of weakness in the Namaste business and higher-than-expected currency translation impact. Dabur’s steady performance stands out in the backdrop of the massive disappointment we have seen on 3QFY15 earnings reports in the sector so far. Consolidated financials – revenues were up 9% yoy to `20.74 bn, 2% below expectations while EBITDA grew a healthy 18% yoy to `3.46 bn. EBITDA margin expanded 134 bps yoy to 16.7%, broadly in line with our expectations. Reported net profit of `2.83 bn (+16% yoy) was broadly in line with our estimated `2.87 bn. For 9MFY15, Dabur has reported revenue, EBITDA and PAT growth of 11%, 13% and 15% respectively. Standalone financials – revenues grew 12% yoy to `15 bn, in line with our estimate while EBITDA grew a strong 19% yoy to `2.6 bn, again in line. EBITDA margins expanded 107 bps yoy to 17.3% on the back of 111 bps expansion in gross margins. Gross margin expansion was led partly by better revenue mix (lower growth in foods). Benefits of RM correction are yet to show up in gross margin expansion. Standalone PAT grew 19% yoy to `2.17 bn, marginally ahead of our expectations. We like what we see and expect FY2016E to be a year of strong EPS growth Dabur has delivered healthy, ahead-of-the-market volume growth for the past many quarters in a challenging demand backdrop. The company’s diversified portfolio, low dependence on premiumization for growth, and superior in-market execution have all helped, in our view. We expect robust relative volume momentum to continue even as the absolute levels would depend on the growth trajectory of the broader economy. Most importantly, we expect Dabur to retain a good portion of RM-correction-led gross margin benefits as the company’s dominant position will likely enable it to hold on to prices in a few categories. The company would sure reinvest a portion of the benefit on A&P; however, the already-high relative A&P levels would aid flow-through of a good portion of GM benefits to the EBITDA level. We forecast 22% EPS growth CARG over FY2015-17E. ADD rating stays with a revised target price of `280 (`260 earlier).
LINK
http://www.kotaksecurities.com/pdf/indiadaily/indiadaily02022015ka.pdf
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