Colgate Palmolive Stock Hits 52-Week Low After Company Indicates Pain In Q4

Shares of Colgate Palmolive (India) Ltd. hit a 52-week low during early trade on Tuesday after the company pointed to lingering pain in the ongoing quarter amid a demand slowdown.

The management spoke to select analysts where they indicated muted growth in the fourth quarter of the current year due to high base and weaker demand.

The toothpaste-maker continues to face profitability pressures due to increased spending on promotions and discounts. Although the company implemented price hikes, the benefits may be partially offset by the higher costs associated with schemes and promotions, potentially limiting the positive impact on earnings, executive told analysts.

This coupled by revenue-led operating deleverage will keep margins weaker on an annual basis.

Analysts expect a meagre 1.5% revenue growth, 1% volume growth and a 9% decline in operating income (Ebitda) and net profit in the January-March period. Such projection can reduce earnings estimates by 3% for the current fiscal and beyond, they said.

Notably, Colgate Palmolive might continue performing ahead of listed oral care peers, according to the management.