DABUR Capital Markets Day 2023: Key Takeaways and Analyst Outlook
DABUR held its Capital Markets Day 2023 on September 15, 2023, where the company’s CEO and divisional heads presented their medium-term strategy. The company reiterated its focus on the following four key areas:
- Growing power brands into power platforms
- Premiumizing the portfolio
- Entering into new categories and increasing total addressable market (TAM)
- Expanding into new variants and formats
These efforts have yielded results over FY19-23, with the company gaining market share in 90% of its portfolio, achieving high-single-digit revenue growth, and increasing the share of innovations to 4% from 1.4% in FY19.
Analysts believe that sustained innovation and launches in core segments will help DABUR achieve double-digit sales growth. With inflationary headwinds largely abating, DABUR is looking to gradually increase ad-spends from 5.6% in FY23 to earlier levels to support its brands. Recovery in rural markets is key to accelerating sales growth, as this segment accounts for 50% of the company’s revenues.
Analysts believe that scalable opportunities in Badshah, Beverages, new launches like baby care, and brand extensions hold the key to medium-term growth. Additionally, the company’s focus on cost reductions through higher freight optimization, lower distance to market, and multiple vendors for raw materials and cartons will help remove costs from the system and improve profitability.
Analyst Target Price
Analysts estimate 15.4% EPS CAGR over FY23-25E and arrive at a DCF-based target price of Rs600 (45.6xJun25 EPS). Dabur trades at 43.0x Jun25 EPS with 21.2% ROE and 50% dividend payout. Analysts retain ‘Accumulate’ rating on the stock.
Overall, DABUR is a well-positioned company with a strong track record of growth. The company’s medium-term strategy is focused on expanding into new categories, premiumizing the portfolio, and increasing innovation. Analysts believe that these efforts will help DABUR achieve double-digit sales growth and improve profitability.
Related News
- 22 Sep
NBCC shares trade higher on Rs 100 crore work order from SAIL
NBCC shares were trading 3 percent higher on September 22 after the company announced having bagged a work order worth Rs 100 crore from SAIL. This is the fourth order-win announced by the company in this month, the total value of the same being Rs 450 crore. NBCC is a public sector undertaking engaged in the business of construction and real estate development. The company specializes in providing project management, consultancy and engineering services for civil construction, infrastructure development, and real estate projects.
- 22 Sep
Glenmark Pharma stock falls on stake sale in Glenmark Life Sciences
Glenmark Pharma stock fell after the company announced it would sell a 75% stake in its subsidiary Glenmark Life Sciences to Nirma. Analysts expect the stake sale to benefit Glenmark Pharma, as it will transition from a net debt position to a cash surplus position. This is expected to have a positive impact on the company's return ratios over the next two to three years.
- 22 Sep
Berger Paints Shares Hit 52-Week High After Turning Ex-Bonus
Berger Paints shares surged 6% to hit a 52-week high after turning ex-bonus on the record date for the issue of bonus shares in the ratio 1:5. The company posted a net profit of Rs 326.3 crore in the April-June quarter of FY24, up 39% year-on-year, on revenue of Rs 2,739.7 crore, up 10% year-on-year. The company expects to get net cash positive by the end of this fiscal year and expects to end the year with double-digit revenue growth on strong demand outlook.
- 22 Sep
Market Update for September 22, 2023
IdeaForge Tech up 3.4% on order RVNL up 3% on highway MoU JSW Steel up 0.4% on sale ICICI Lombard down 1.6% on CEO exit ICICI Bank down 1% on healthcare investment NHPC up 1.3% on extended additional charge Kalyani Forge up 3.2% on new MD IRB Infra up 2.5% on road project closure
- 22 Sep
Lux Industries Shares Down 3% After Income Tax Raid
Lux Industries shares fell 3% on September 22 after news emerged that the Income Tax department had conducted searches at the company's premises in Kolkata and alleged a tax evasion of Rs 200 crore. The company has confirmed the searches and is extending full support.
Leave a Reply