P&G - Committed Efforts Underway To Ensure Sustained Growth: Motilal Oswal
The uncertain pace of sales and earnings recovery and expensive valuations lead us to maintain our 'Neutral' rating.
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Motilal Oswal Report
Procter and Gamble Hygiene and Health Care Ltd. organised an analyst meet to share its performance over the years and here are the takeaways:
P&G has achieved superior growth over the years through a strong portfolio of products, including superior packaging, brand communication, and retail execution. Its strategic integration of productivity measures led to substantial savings of approximately Rs 1.05 billion in FY23.
It holds over 50% market share in both feminine care and health care categories and 90% of the company products are natural and Ayurvedic.
The market in which the company deals is still underpenetrated, offering ample opportunities for growth. The management expects mid-single digit volume growth over the next four to five years and believes that bottom-line growth will outpace the top-line growth.
P&G leverages artificial intelligence and machine learning to enhance convergence, reduce non-movable inventories, improve consumer behavior analysis, and expand distribution reach.
E-commerce and digital channels contribute significantly, now accounting for double-digit percentages of total revenue.
Over the past decade, it has demonstrated superior and sustained execution with a compound annual growth rate of 9%/13% in net sales/profit after tax for FY23. Additionally, its return on equity has increased by 54% over FY13-23.
The P&G Shiksha program has significantly improved the learning environment and empowered marginalized communities. Presently, it collaborates with 13 partners and positively impacts ~+35 lakh children.
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