Sharekhan has given Buy recommendation for Godrej Consumer Products with a target price of Rs. 1249 in its research report issued on Sep 27, 2021
Sharekhan’s research report on Godrej Consumer Products
The company is focusing on growth levers such as 1) improving penetration of aerosols/liquid vapourisers in household insecticide (HI); 2) regaining lost market share in wet-wipes through competitive pricing; and 3) gaining scale in hygiene to drive double-digit revenue growth in Indonesia. India business is expected to grow in double digits with all key categories (including soaps and HI) expected to report double-digit revenue growth in FY2022. Raw-material inflation will continue to put pressure on margins in the near term. Calibrated price hikes and operating efficiencies would help in mitigating cost pressures.
We maintain Buy on Godrej Consumer Products Limited (GCPL) with the revised PT of Rs. 1,249. The stock is currently trading at 44x/39x its FY2023E/FY2024E EPS, discount to some of the large peers.