Colgate Q3 Results Review - Margin Surprises; Valuations Out Of Comfort: Yes Securities

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..Yes Securities Report.Colgate-Palmolive India Ltd. delivered highest ever gross and Ebitda margin in Q3 FY24 while topline was in-line with our estimate. Operating beat seems to be driven by better mix plus pricing as gross margin saw a 340 basis points QoQ improvement, coming as a surprise especially post the analyst meet commentary in August-23 guiding modest improvement from Q1 FY24 levels..Toothpaste volume have seen expansion in Q3 FY24, but growth looks lower than our estimate of 5% because of the assumed sharp mix plus pricing improvement. Recent relaunch/restaging of key brands and activations through campaigns, should continue to support near-term growth. Any improvement in market growth rates, especially in rural, should only further accelerate the volume momentum..There has been ~24% upward movement in stock price post Q2 FY24 result. We downgrade the stock to 'Reduce' rating with a revised target price of Rs 2,350 (Rs 2,080 earlier), as we assign target multiple of ~43 times on September ’2025E earning per share. For further rerating, market share improvement in core and update on inorganic opportunities being explored in personal care will be vital..Click on the attachment to read the full report:.Reliance Industries Q3 Results Review- Retail, Upstream Offsets Subdued O2C Performance: Yes Securities.DISCLAIMERThis report is authored by an external party. NDTV Profit does not vouch for the accuracy of its contents nor is responsible for them in any way. The contents of this section do not constitute investment advice. For that you must always consult an expert based on your individual needs. The views expressed in the report are that of the author entity and do not represent the views of NDTV Profit..Users have no license to copy, modify, or distribute the content without permission of the Original Owner.

Colgate Q3 Results Review - Margin Surprises; Valuations Out Of Comfort: Yes Securities

Domestic growth stood at 8.8% YoY, with toothpaste segment witnessing double digit growth and positive volume expansion.

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