Fundamental Result Update

Marico Q1FY20 Result Update



Marico came out with good set of numbers in Q1FY20 ahead of our estimates. Consolidated revenue grew 6.9% YoY to Rs 21660 mn against our estimate of Rs 21090 mn. EBITDA for Q1FY20 came at Rs 4630 mn (estimate Rs 4170 mn) a growth of 26.5% YoY. EBITDA margin increased 332 bps YoY to 21.4% for the quarter against 18.1% in Q1FY19, while on QoQ basis margins expanded 304 bps. Consolidated PAT for the quarter stood at Rs 3100 mn; which was in line with our estimate of Rs 3120 mn, a growth of 21.6% YoY. We like Marico over other FMCG peers due to its strong pricing power in its flagship Parachute brand, which makes it relatively insulated from weak demand environment plaguing other FMCG players. Also multiple tailwinds like deflationary copra cycle leading to higher gross margin and revival in Food and Saffola portfolio keep our faith intact on Marico. Maintain Buy with TP of Rs 435 (unchanged).


Tags: FundamentalResult Update


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