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CapitalVia Global
Godrej Consumer (Buy)
Target: ₹840
CMP: ₹735.00
Godrej Consumer Products is engaged in the manufacture of personal and household care products. The company's geographic segments include both within & outside India.
The company offers a range of products in India, which include household insecticides, such as aerosols, liquid vaporizers, coils and mats; hair colors; soaps and air fresheners.
In the July-September quarter (Q2-FY21), FMCG companies experienced strong growth after two consecutive quarters of revenue decline, provided that a significant part of the supply disruption was mitigated. Packaged food and immunity-boosting goods continue to rise at a faster pace on the demand front.
The company had reported consolidated revenue of ₹2,929 crore (₹2,349 crore q-o-q and ₹2,656 crore y-o-y).
Categories such as soaps and hand washing have been improved by enhancing the grooming habits of domestic consumers. Penetration by hand wash group over 15 years, has improved from 0 to 19 per cent. The penetration, however, increased to 34 per cent in the last eight months (Covid-19 impact). The management expects the penetration of hand wash in India to enhance in next 4-5 years, to 50 per cent.
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