Godrej Consumer Reported Double-digit Volume Growth

By Consultants Review Team Tuesday, 09 July 2024

The leading FMCG company, Godrej Consumer, has said that although the first quarter's operational circumstances were still challenging, the India business recorded high single-digit organic volume growth and mid-single-digit value growth.

In its business update published on July 8, Godrej Consumer stated that overall growth will be double-digit in volume and high-single digit in value terms. Consolidatedly, GCPL anticipates a double-digit increase in revenues in constant currency, unchanged INR sales, and double-digit growth in reported EBITDA.

"Both personal care and home care saw a widespread increase. Due to severe heatwaves across the nation, demand for household insecticides had been weak during the first part of the quarter, the business stated in a filing with the bourses.

"Park Avenue and KamaSutra brands are performing well post portfolio simplification actions and are in line with our full-year growth ambition," it stated.

Godrej's Indonesian company achieved double-digit constant currency sales growth and high single-digit volume growth, indicating a solid performance. Nonetheless, there has been a significant depreciation of the Indonesian currency, which has reduced growth in INR terms.

Conversely, a double-digit volume decrease is anticipated in the GAUM (Godrej Africa, USA, and Middle East) organic sector, with West Africa leading the way. This is because of a high base from the same quarter of the previous fiscal year and some difficult price decisions made in Nigeria.

The currency in Nigeria continues to negatively impact Godrej Consumer's INR sales performance. Despite this, the company has grown EBITDA (reported) in INR terms in strong double-digits.

International brokerage Morgan Stanley retained its equal weight on Godrej Consumer, maintaining its target price of Rs 1,231 per share. This indicated a downside of 13.6 percent from the previous close.

Over the past year, shares of the firm have gained around 35 percent in trade as against a 25 percent rise in the frontline Nifty 50 index.

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