Chief Engineer
August 18, 2009 | FMCG
Initiating Coverage
Dabur India (DABIND)
Creating waves in the FMCG space…
Dabur India Ltd, (DIL) with its diverse product portfolio, extensive presence in under-penetrated categories and ability to foray into new categories by successfully driving inorganic and organic growth is expected to capitalise on growing FMCG trends. Subsequently, we expect net sales and net profit to grow at a CAGR of 16.9% and 19.5%, respectively from FY09E-FY11E. We are initiating coverage on the company with a PERFORMER rating.
Current Price Rs 122 Potential upside 16.3%
Target Price Rs 142 Time Frame 12 months
PERFORMER
Analysts’ Name Sanjay Manyal sanjay.manyal@icicisecurities.com Ritika Shewakramani ritika.shewakramani@icicisecurities.com Sales & EPS trend
4500.0 3500.0 2500.0 1500.0 500.0 FY07 FY08 FY09 FY10EFY11E Net sales (Rs crore)
EPS (Rs)
Diversification of product portfolio led by inorganic growth
DIL’s product portfolio is present across diverse categories, namely personal care, health care, home care, foods and classical ayurvedic products. It is expected to sustain its sales growth momentum buoyed by a slew of product launches and synergistic inorganic acquisitions (Balsara & Fem Care Pharma Ltd), thereby, enabling it to further supplement its product portfolio.
Renewed focus on international and consumer health businesses
On account of the acceleration in growth witnessed in DIL’s international and consumer health businesses, we foresee revenue contributions from these divisions increase significantly. Subsequently, we expect the international business to contribute 24% to total revenues in FY11E (from 18.5% in FY09), buoyed by expansions into new regions and the consumer health business contributing 8.7% to total revenues in FY11E (from 7.3% in FY09) led by new ayurvedic product launches in its over the counter (OTC) portfolio.
8.0 6.0 4.0 2.0 0.0
Effectively set to withstand deficient rainfall
Although the
Initiating Coverage
Dabur India (DABIND)
Creating waves in the FMCG space…
Dabur India Ltd, (DIL) with its diverse product portfolio, extensive presence in under-penetrated categories and ability to foray into new categories by successfully driving inorganic and organic growth is expected to capitalise on growing FMCG trends. Subsequently, we expect net sales and net profit to grow at a CAGR of 16.9% and 19.5%, respectively from FY09E-FY11E. We are initiating coverage on the company with a PERFORMER rating.
Current Price Rs 122 Potential upside 16.3%
Target Price Rs 142 Time Frame 12 months
PERFORMER
Analysts’ Name Sanjay Manyal sanjay.manyal@icicisecurities.com Ritika Shewakramani ritika.shewakramani@icicisecurities.com Sales & EPS trend
4500.0 3500.0 2500.0 1500.0 500.0 FY07 FY08 FY09 FY10EFY11E Net sales (Rs crore)
EPS (Rs)
Diversification of product portfolio led by inorganic growth
DIL’s product portfolio is present across diverse categories, namely personal care, health care, home care, foods and classical ayurvedic products. It is expected to sustain its sales growth momentum buoyed by a slew of product launches and synergistic inorganic acquisitions (Balsara & Fem Care Pharma Ltd), thereby, enabling it to further supplement its product portfolio.
Renewed focus on international and consumer health businesses
On account of the acceleration in growth witnessed in DIL’s international and consumer health businesses, we foresee revenue contributions from these divisions increase significantly. Subsequently, we expect the international business to contribute 24% to total revenues in FY11E (from 18.5% in FY09), buoyed by expansions into new regions and the consumer health business contributing 8.7% to total revenues in FY11E (from 7.3% in FY09) led by new ayurvedic product launches in its over the counter (OTC) portfolio.
8.0 6.0 4.0 2.0 0.0
Effectively set to withstand deficient rainfall
Although the