Godrej Consumer share price rallies 8% to hit 52-week high as Q4 results beat estimates; Should you buy?

Godrej Consumer share price rallied nearly 8% to hit a 52-week high of ₹1,349.65 apiece on the BSE Tuesday after the company’ fourth quarter earnings beat analysts’ estimates.

The FMCG major Godrej Consumer Products posted a net loss of ₹1,893 crore in Q4FY24 as against a net profit of ₹452 crore in the year-ago period. The company had incurred a one-time exceptional loss of ₹2,376 crore during the March quarter due to reorganisation of Africa business. 

Its revenue in Q4FY24 rose 6% to ₹3,385.61 crore from ₹3,200.16 crore, YoY.

The consolidated volume in the quarter ended March 2024 grew at 12% with India business volume growing by 15%, and Indonesia volume growing by 12%. 

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The home care category grew by 6%, and personal care grew by 4% on the back of volume-led growth.

The company’s board of directors also recommended an interim dividend of ₹10 per share for the financial year 2023-24.

“We continue to remain focused on driving volume-led growth along with healthy investments in our brands and improvement in profitability. We are launching new products in accordance with our purpose to bring the goodness of health and beauty to consumers.” said Sudhir Sitapati, MD and CEO.

GCPL’s Q4FY24 results beat Emkay Global’s expectations, with inline sales growth of 6% albeit better margin at 22.3% driving the EBITDA beat of 6%, while the lower tax rate drove the adjusted PAT beat of 15%. 

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“Domestic business performance missed expectations, with sales and EBITDA growing 12% each. International business reported a 2% decline, affected by reorganization of the East Africa business; EBITDA expanded 34% YoY, with EBITDA margin expansion of 435 bps YoY to 16.1%,” said Nitin Gupta, Senior Research Analyst at Emkay Global Financial Services.

The brokerage firm maintained an ‘Add’ rating on Godrej Consumer Products shares, with March 2025 target price ₹1,350 per share

Foreign brokerage firm Jefferies said that Godrej Consumer Q4 results were above its estimates, with key positives being HSD and industry-leading volume growth In soaps and double-digit volume growth in emerging categories. It also noted strong traction in Indonesia and good EBITDA delivery in GAUM despite foreign exchange headwinds

Jefferies has a ‘Buy’ call and Godrej Consumer share price target of ₹1,520 apiece.

At 10:10 am, Godrej Consumer shares were trading 5.14% higher at ₹1,315.00 apiece on the BSE.

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