July 30, 2024
New Delhi, India
Q1 Results
- Net Profit: Colgate Palmolive India reported a consolidated net profit of ₹364 crore for the June quarter of FY25, marking a 33% growth from ₹273.68 crore in the same period last year.
- Sales: The company’s net sales for Q1 FY25 stood at ₹1,485.8 crore, a 13% increase from ₹1,314.7 crore in the year-ago quarter.
- EBITDA: Earnings Before Interest, Tax, Depreciation, and Amortisation (EBITDA) rose by 21.5% year-over-year to ₹508.3 crore. The EBITDA margin expanded by 240 basis points (bps) to 34%, maintaining consistency despite a 10% year-on-year increase in advertising investments.
Market Reaction:
- Stock Performance: Shares of Colgate Palmolive India jumped over 6% to reach a 52-week high of ₹3,408.40 apiece on the BSE following the strong Q1 results. Analysts raised their target prices on the stock, although they noted that current valuations may limit further upside in the near term.
At the time of writing this article, Colgate shares were at Rs. 3,396 a piece up 186 or 5.79% at 11:06 A.M.
Also Read: Shares of IdeaForge Technologies Tumble To 14% After Negative Q1 Results
Growth Drivers:
- Rural Market Demand: The company experienced continued demand growth in rural markets, outpacing urban market growth for the second consecutive quarter. This demand, along with robust performance in toothpaste, toothbrush, and personal care segments, contributed to a 12.8% year-on-year growth in domestic revenues.
- Toothpaste Portfolio: Colgate’s toothpaste portfolio saw double-digit growth, driven by high single-digit volume growth.
Management Commentary: Prabha Narasimhan, Managing Director & CEO of Colgate-Palmolive India, highlighted the strong performance of the toothpaste portfolio and the company’s ability to maintain EBITDA margins despite higher advertising expenditures.
Colgate Palmolive India delivered robust financial performance in Q1 FY25, driven by strong demand in rural markets and significant growth in its toothpaste portfolio. The positive market reaction reflects confidence in the company’s continued growth, although analysts caution about the limited upside potential in the near term due to current stock valuations.
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