Jyothy Laboratories Q3 Results Review - Inline Performance; Focus On Volume-Driven Growth: Motilal Oswal

Motilal Oswal Report

Jyothy Laboratories Ltd. reported an in-line sales at Rs 6.7 billion, a growth of 11% YoY (four-year compound annual growth rate at 13.6%). Volume growth stood at 11% YoY. Fabric care sustained double-digit growth (12%); healthy demand seen in the mid-price detergent powder.

Dishwashing growth was slightly slow at 7%, after clocking a double-digit growth in H1 FY24, driven by competition from local or regional players. HI remained weak at 5% YoY growth; four year CAGR stood at 2%.

We believe a large part of gross margin led earnings growth witnessed in nine months FY24 will be normalised in FY25. Here onwards, market share gain and success of new launches will be critical drivers for earnings growth.

With rich valuation, we maintain our 'Neutral' rating with a target price of Rs 500 on 40 times December- 25E

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