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Godrej Consumer Gets 'Buy' Upgrade As ICICI Securities Bets On Double-Digit Volume Growth — Check New Target Price

The brokerage expects consensus earnings upgrades over the next one year as these strategic initiatives fully play out, making the Godrej Consumer's current stock price a good entry point.

Godrej Consumer Gets 'Buy' Upgrade As ICICI Securities Bets On Double-Digit Volume Growth — Check New Target Price
Buy upgrade reflects a fundamental change in Godrej Consumer's operational risk profile, adds ICICI Securities.
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STOCKS IN THIS STORY
Godrej Consumer Products Ltd.
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NDTV Profit's special research section collates quality and in-depth equity and economy research reports from across India's top brokerages, asset managers and research agencies. These reports offer NDTV Profit's subscribers an opportunity to expand their understanding of companies, sectors and the economy.

ICICI Securities Report

ICICI Securities has upgraded Godrej Consumer Products Ltd. to Buy from Add as it believes the company is entering a phase of double-digit volume growth.

The stock has declined ~14% in last one year and has delivered a compound annual growth rate of ~2.6% in last five years (Ebitda CAGR was ~5.5%).

The brokerage believes Godrej Consumer's growth will likely be driven by:

  1. healthy growth in ‘mothership' (core) categories;
  2. compelling growth potential in ‘speedboats'; and
  3. a structural turnaround in international markets.

In ICICI Securities opinion, management is also successfully handling raw material inflation through price changes, cost savings and formulation interventions (reduced TFM in soaps).

The brokerage expects the growth momentum to sustain in the medium term, given penetration opportunities in core portfolios, regular new launches, and a structural turnaround in international markets.

Click on the attachment to read the full report:

Icici Securitie Godrej Consumer Update.pdf
VIEW DOCUMENT

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