Godrej Consumer Q1 Results Review - Inconsistency In Household Insecticides Business Continues: Dolat Capital

Dolat Capital Report

Godrej Consumer Products Ltd.’s Q1 FY25 revenue missed our estimate, while Ebitda and adjusted profit after tax were in line. The company reported 10% volume growth in India business.

Domestic organic business posted 8% volume growth. Home care reported 8% sales growth driven by double digit growth in air fresheners and fabric care, while severe heatwaves in India impacted HI performance.

We maintained our FY25/26E earnings per share estimates at Rs 23.8/27.1, as Q1 profitability was in line with our estimate. Godrej Consumer’s new product launches across HI and body wash category are encouraging and we believe that the company would grow ahead of industry in HI business.

Valuing the stock at 52 times FY26E EPS (in line with peers) we arrive at a target price of Rs 1,407. However, considering rich valuation and recent run up in the stock price, we maintain our ‘Sell’ rating.

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