Analysts' picks: Procter & Gamble
India Infoline has recommended a ‘buy’ rating on Procter & Gamble with a one-year price target of Rs 901 after factoring in the 25% year-on-year growth in the net sales of the company and 42.50% rise in net profit.
Procter & Gamble
cmp: Rs 772.30
target price: Rs 901
India Infoline has recommended a ���buy��� rating on Procter & Gamble with a one-year price target of Rs 901 after factoring in the 25% year-on-year growth in the net sales of the company and 42.50% rise in net profit. ���Procter & Gamble registered 24.8% YoY growth in revenues at Rs 1.9 billion, led by strong growth in the health and hygiene segments,��� says the report adding that the ���feminine hygiene segment recorded its highest ever turnover of Rs 970 million; a growth of 29.5% YoY.��� The report also notes that ���margins remain under pressure due to sharp rise in raw material cost and adspend. However, the report adds that the sharp decline in overhead costs restricts further margin erosion. The broking house also feels that due to low penetration level and low per capita consumption, healthcare and feminine hygiene categories have a tremendous potential to grow. According to the report, the company has set up two new healthcare plants in Baddi with an investment of Rs 600 million to meet increasing demand for its products. With the additional contribution from the new plants, the broking outfit expects the overall profitability to improve going forward.
cmp: Rs 772.30
target price: Rs 901
India Infoline has recommended a ���buy��� rating on Procter & Gamble with a one-year price target of Rs 901 after factoring in the 25% year-on-year growth in the net sales of the company and 42.50% rise in net profit. ���Procter & Gamble registered 24.8% YoY growth in revenues at Rs 1.9 billion, led by strong growth in the health and hygiene segments,��� says the report adding that the ���feminine hygiene segment recorded its highest ever turnover of Rs 970 million; a growth of 29.5% YoY.��� The report also notes that ���margins remain under pressure due to sharp rise in raw material cost and adspend. However, the report adds that the sharp decline in overhead costs restricts further margin erosion. The broking house also feels that due to low penetration level and low per capita consumption, healthcare and feminine hygiene categories have a tremendous potential to grow. According to the report, the company has set up two new healthcare plants in Baddi with an investment of Rs 600 million to meet increasing demand for its products. With the additional contribution from the new plants, the broking outfit expects the overall profitability to improve going forward.
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