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Dolat Capital Report
Dabur India Ltd.'s Q3 FY23 results came broadly in line with our estimate. Domestic fast moving consumer goods registered 3% volume de-growth and three-year revenue compound annual growth rate of 9.0%.
Growth in the domestic market was driven by strong growth in home care business but was restricted due to sluggish performance in skin portfolio due to delayed winter.
Colder winter this year is expected to drive winter related product sales in Q4 FY23E.
In Q3, Dabur has witnessed demand challenges in the rural market – second consecutive quarter of rural pressure. However, the company is hopeful about the rural recovery considering incremental government spends in rural areas.
We believe that the rural slowdown is in its final phase and rural performance would improve in H1 FY24E. Favorable base, government expenditure and consumer adaptability would drive rural growth.
We have lowered our earnings per share estimates for FY23/24/25E by 2.6/2.2/3.0% to factor in the Q3 performance. However, we remain optimistic on the rural recovery and the company's efforts to gain market share across categories.
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More Research Reports On Dabur India's Q3 FY23 Results Review
Sluggish Volume, Margin Performance; Better Pricing, Mix To Drive Recovery: Systematix
Weak Rural Demand Dents Volumes; But Outlook Getting Better: Motilal Oswal
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