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Yes Securities Report
Dabur India Ltd. Q4 FY24 operating performance was better than our estimate. Rural growth which grew 200 basis points ahead of urban growth in Q3 for Dabur, grew at ~8% this quarter, 400 bps ahead of urban on the back of moderating inflation, distribution infrastructure expansion and building of rural centric portfolio.
Within the domestic categories, oral care and digestives growth were big positives but health supplements, hair oils and beverages partially suppressed the overall revenue performance.
YoY gross margin improvement aided Dabur deliver decent operating margin even after taking a hit from ‘Namaste’s’ legal cost regarding ongoing litigation.
With optimism around continued rural recovery led volume growth improvement, near-term margin visibility and valuation comfort, makes us maintain our Buy rating and as a preferred top pick for FY25 within the fast moving consumer goods pack with a revised target price of Rs 665.
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