Investment Pick - Dabur India Ltd.
* Dabur India reported strong Q2FY21 numbers; its revenue grew by 13.7% YoY to Rs 2,516 cr driven by double digit volume growth of 16.8% in domestic FMCG business. Its EBITDA grew by 16.5% YoY to Rs 570 cr while margin expanded by 53bps. PAT grew by 20% YoY to Rs 483 cr on the back of lower interest expense (down by 50% YoY). Thus, PAT margin improved by 99bps.
* Going forward, management strategy would remain unchanged as it continues to focus on health and hygiene segment, launching new products, investing behind brands while maintaining cost and expanding in e-commerce space. Besides, favourable monsoon and enhanced stimulus announced by the government would boost growth in rural economy in the coming quarters. Therefore, we remain positive on the company’s long term growth plans and have maintained a Buy on the stock with a target price of Rs 616.
Buy Dabur India Ltd @ 9-12 Months CMP 507.9 TGT 616
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