Moneycontrol PRO
Check Credit Score
Check Credit Score
HomeNewsBusinessStocks

Accumulate Emami; target of Rs 241: Dolat Capital

Dolat Capital recommended accumulate rating on Emami with a target price of Rs 241 in its research report dated June 29, 2020.

July 02, 2020 / 04:43 PM IST
 
 
live
  • bselive
  • nselive
Volume
Todays L/H
More

Dolat Capital's research report on Emami

Emami’s Q4FY20 results were below our estimate. Domestic business declined 19%, while IB posted 4% revenue de-growth. Weak rural demand coupled with liquidity concerns prior to lockdown; and supply chain disruption from mid-March due to Covid-19 resulted in sales decline. Though GT was under pressure, MT grew by 26% and E-com jumped 167% during the quarter. MT/e-com contribution increased from 9/0.5% last year to 12/1%+ in FY20. The company plans to double E-com contribution in FY21E with distinct products and SKU’s. Management expects to sustain IB momentum with double digit growth in FY21E led by new launches. We believe that competition in Emami’s key product categories, such as skin, health care, and hair oil, will continue to remain high. Although, we remain optimistic about the favorable base, we believe that the business environment for Emami will remain challenging, given intense competition.

Outlook

Although RM costs are expected to remain stable, liquidity crunch at the wholesale level may hamper performance. As most of the negatives are factored in the stock price, we upgrade the rating to Accumulate with TP of Rs 241 (17x FY22E CEPS).

For all recommendations report, click here

Disclaimer: The views and investment tips expressed by investment experts/broking houses/rating agencies on moneycontrol.com are their own, and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.

Broker Research
first published: Jul 2, 2020 04:43 pm

Discover the latest business news, Sensex, and Nifty updates. Obtain Personal Finance insights, tax queries, and expert opinions on Moneycontrol or download the Moneycontrol App to stay updated!

Advisory Alert: It has come to our attention that certain individuals are representing themselves as affiliates of Moneycontrol and soliciting funds on the false promise of assured returns on their investments. We wish to reiterate that Moneycontrol does not solicit funds from investors and neither does it promise any assured returns. In case you are approached by anyone making such claims, please write to us at grievanceofficer@nw18.com or call on 02268882347