Q4FY21 Result Update - Dabur India - ICICI Direct

Dabur India (DIL) reported 25.3% revenue growth in Q4 on account of de-growth in the base quarter with lockdown imposed in the last 10 days of the March quarter. Domestic sales grew 30.3% whereas international business saw 19.4% revenue growth. India business volume growth was 25.4%. All categories saw robust growth. Health supplements (Chyawanprash, Honey) sales grew 17.7% despite it being off-season for the products. OTC & Ethical continued the growth momentum with 34% & 39.1% growth, respectively. Oral care grew 42.1% with red toothpaste gaining market share. Similarly, hair oil, shampoos, Digestives also saw strong growth of 24.6%, 33.4% & 20%, respectively, largely on the back of increased out of home activity. Foods segment, which was significantly impacted in the corresponding quarter, saw 36.1% growth. With firm agri commodity prices & rising crude based derivative, gross margins increased 35 bps. We believe the company has taken select price increase to pass on rising commodity costs. Given 78 bps savings in overhead spends, 85 bps savings in employee spends & 126 bps increase in advertisement spends, the company was able to maintain its operating margins at 18.9%. Operating profit increased 25.6%. PAT was up 34% to Rs. 377.3 crore on the back of strong growth in operating profit, stable taxation and higher other income.

Valuation & Outlook

DIL has been able to grow revenue by 10% in a challenging year. We believe health & immunity related tailwinds & related new product and increasing direct & rural distribution network (1.4 million outlets & 80000 villages) would help drive growth for the company. We expect 12.8% earnings CAGR in FY21-23E and maintain our BUY rating and TP of Rs. 620/share.

For details, click on the link below: https://www.icicidirect.com/mailimages/IDirect_Dabur_Q4FY21.pdf

Shares of DABUR INDIA LTD. was last trading in BSE at Rs.525.45 as compared to the previous close of Rs. 522.65. The total number of shares traded during the day was 87393 in over 2420 trades.

The stock hit an intraday high of Rs. 526.5 and intraday low of 520.7. The net turnover during the day was Rs. 45720075.

Source : Equity Bulls

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