Prabhudas Lilladher has given Accumulate recommendation for Dabur India with a target price of Rs. 647 in its research report issued on Nov 02, 2021
Prabhudas Lilladher’s research report on Dabur India
We upgrade Dabur from Hold to Accumulate following strong market share gains in core categories, sustained increase in direct rural reach, lesser impact of input cost inflation due to niche products and sustained innovation pipeline. Although rural demand is a bit soft, we expect it to be temporary given good monsoons and increased rural job opportunities in Infra and housing. Management maintains double digit revenue growth for FY22 and believe Dabur is well placed to gain share across key segments despite increasing competition. We believe entry into large and high growth segments like Odomos Liquid Vaporizers, Vatika Face wash and Aloe Vera Gel can accelerate growth. We believe Dabur Vita (Malted food drink) marks entry into large but highly competitive category where their earlier launch (Chawyan Junior) had flopped in 2007-08.
Dabur India trades at 40.8xFY24 EPS with 15.2% PAT CAGR and 50% dividend payout offering scope for steady returns over long term. Upgrade to Accumulate with TP of Rs647 (unchanged).