KR Choksey has given Accumulate recommendation for Colgate Palmolive (India) with a target price of Rs. 1753 in its research report issued on Oct 21, 2022
KR Choksey’s research report on Colgate Palmolive (India)
In Q2FY23, CLGT reported revenue of INR 13,875 mn (+2.6% YoY/ +15.9% QoQ). For H1FY23, revenue was at INR 25,843 mn (+2.6% YoY). EBITDA for Q2FY23 was INR 4,080 mn (+1.8% YoY/ +25.3% QoQ). EBITDA margin for the quarter was at 29.4%, which was a contraction of 23 bps YoY but an improvement of 219 bps QoQ, despite the pressure on gross margins. EBITDA margin for H1FY23 contracted by 163 bps YoY to 28.4%. Adj. Net Profit for Q2FY23 was at INR 2,780 mn (+3.3% YoY/ +26.9% QoQ). Adj. Net profit for H1FY23 declined by 1.1% YoY to INR 4,970 mn.
We apply P/E multiple of 38.2x on FY24E EPS of INR 45.9 and arrive at a target price of INR 1,753 per share (unchanged), having an upside potential of 9.1% from CMP. Accordingly, we maintain our rating at “Accumulate” on the shares of Colgate Palmolive India.