For 4QFY20, Colgate Palmolive India Ltd (CPIL) posted results that were below our
expectations on both top-line and bottom-line fronts. Revenue de-grew by ~7% yoy;
reported operating margins contracted by 206bps yoy. On the bottom-line front,
CPIL reported adj. PAT growth of ~2% yoy to `204cr due to lower taxes.
Outlook and Valuation: We believe that the CPIL will ultimately be able to see
sharper market share gains in toothpastes segment on the back of higher ad-spends,
new product launches, strong brand and wide distribution network. Thus, we
maintain BUY on the stock with Target Price of `1,588.

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