Godrej Consumer: Clear emphasis on achieving doubledigit volume growth
Source: IRIS | 21 Dec, 2021, 04.12PM
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| Rating: NAN / 5 stars. |
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 Motilal Oswal Institutional Equities remains bullish on Godrej Consumer Products (GCPL) and maintains Buy rating with a target price of Rs 1,150 per share.
"In his first interaction since taking over as GCPL's CEO, Sudhir Sitapati indicated a clear focus on achieving double-digit volume growth in the medium term. He also outlined GCPL's strengths in innovation, quality obsession, and a frugal cost mindset.
Other modest strengths include robust processes, good market distribution, and a top notch portfolio, with ample potential for growth. At the same time, he also admitted GCPL's weaknesses such as the relative inability to drive category development, high complexity, inadequate global collaboration, and frugality in investments.
Sitapati guided at a 150-200bp EBITDA margin improvement and significant inventory reduction in the medium term. GCPL's valuations are attractive at 40.4x FY23E EPS," the broking firm said.
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