Jyothy Labs - Expansion Plan In Personal Care Category: Motilal Oswal

Motilal Oswal Report

We recently had an interaction with the management of Jyothy Laboratories Ltd., about recent developments at the company. Here are the key takeaways:

• The company plans to further expand in the personal care category. Currently, Jyothy Labs derives 45% of its revenue from fabric care, 35% from dishwashing products, 10% from household insecticides, and the remaining 10% from personal care items.

• The southern region accounts for 40% of Jyothy Labs’ total business, while the remaining 60% is distributed across three other markets. Among the remaining three regions, the eastern market constitutes the largest share followed by the northern and western markets.

• Looking ahead, Jyothy Labs is optimistic about H1 FY24 but expects challenges in the second half due to rising commodity and crude oil prices. Currently, 60% of the company's market is in urban areas, which are performing well. The remaining 40% in rural areas is expected to see growth in the coming years.

• The company aims for double-digit growth in FY24, mainly driven by increased sales volume. It also targets operating margin in the range of 15- 16%. Ad expenses are expected to remain within the 7-8% range.

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