Stock Of The Day: Emami Hits All-Time High After Q4 Results
The rose as much as 18.16% during the day to Rs 619 apiece on the NSE.
Shares of Emami Ltd. surged over 18% on Thursday to a record high after its net profit rose 3.6% to Rs 146.8 crore in the fourth quarter of financial year 2024.
Emami Q4 FY24 Earnings Highlights (Consolidated, YoY)
Revenue up 6.6% to Rs 891 crore versus Rs 836 crore.
Ebitda up 5.6% to Rs 211 crore versus Rs 200 crore.
Margin at 23.7% versus 23.9%.
Net profit up 3.6% to Rs 147 crore versus Rs 142 crore.
Key Levels To Watch
Resistance at Rs 619 (Record high)
Support at Rs 507.4 (four-week low)
Emami's stock rose as much as 18.16% during the day to Rs 619 apiece on the NSE. It was trading 15.10% higher at Rs 602.95 per share, compared to a 0.68% decline in the benchmark Nifty at 11:41 a.m.
The share price has risen 7% on a year-to-date basis. The total traded volume so far in the day stood at 11 times its 30-day average. The relative strength index was at 76, implying that the stock maybe overbought.
The management is optimistic about a strong summer season and a favourable monsoon, supported by anticipated margin expansions in the current financial year, indicating a financially healthy trajectory. The Ebitda growth despite a significant increase in advertising and promotion indicates effective cost management and strong revenue generation.
It has projected an effective tax rate of 10% for the next two fiscals, suggesting a favourable tax planning environment. The strategic enhancement in distribution networks is expected to support the company's growth objectives. Emami has specific strategies in place to scale up its male grooming segment.
The first quarter of the current fiscal started on a high note, with strong traction attributed to the summer season. The company has also implemented selective price hikes across certain categories, projecting a 2% overall price increase in the fiscal.
Brokerages on Emami
Nuvama
Retains 'buy' with a revised target price of Rs 645 apiece from 630 earlier.
Increases the earnings-per-share estimates for fiscals 2025 and 2026 by 1.8% and 2.1%.
Emami's distribution initiatives led to an uptick in sales growth.
Organised channels’ contribution to domestic business increased to 26%.
Motilal Oswal
Reiterates 'buy' with a target price of Rs 600 apiece.
Expects an 8% compound annual growth rate in revenue over fiscal 2024–26.
Expects a 27.4% Ebitda margin for fiscal 26 vs. 26.5% in the last fiscal.
Share gain in core categories is no longer a catalyst for volume growth.
