Procter & Gamble Hygiene and Health Care (P&G)’s 3QFY2016 results are
broadly in-line with our estimates. For the quarter, the company’s top-line grew
by ~11% yoy to Rs614cr while the reported PAT grew ~12% yoy to Rs97cr.
Key highlights: For 3QFY2016, the company’s top-line grew by ~11% yoy to
~Rs614cr (against our estimate of ~Rs624cr), mainly due to growth in both female
hygiene and health care segment. On the operating front, the company reported
margin contraction by 41bp yoy to 21.7%, primarily on account of higher other
expenses. The reported net profit grew by ~12% yoy to ~Rs97cr (our estimate was
of ~Rs98cr) on account of healthy sales growth.
Outlook and valuation: On the top-line front, we expect the company to report
~13% CAGR and on the bottom-line front, we expect ~15% CAGR over FY2015-
18E on the back of strong brands and distribution network. Further, P&G is a
market leader in both of its product, ie Whisper (female hygiene segment) and
Vicks (healthcare segment- ointment, creams, cough drops etc). We are positive
on the stock and recommend a Buy rating with a target price of Rs7,369.

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