Dabur India’s stock has jumped nearly 6% since the announcement of fiscal first quarter results, late last week. On Friday, it rose nearly 7% to Rs 570 as the Q1FY24 revenue growth of the company stood at 10.9%, led by 8% growth in the India business. Badshah Masala, acquired by Dabur India grew 22% in Q1FY24 and is expected to produce revenue of Rs 5 billion. Owing to the double-digit growth in HPC and healthcare, Dabur’s revenue grew by 11% on-year. Dabur’s share price has jumped nearly 5% in the last six months and over 1% year to-date. Centrum has recommended a ‘Buy’ rating on Dabur stock, whereas HDFC Securities and ICICI Securities have recommended an ‘Add’ rating.
Should you buy, sell or hold Dabur?
Centrum
Buy | Target price: Rs 638
HDFC Securities
Add | Target price: Rs 570
“With moderating inflation aiding recovery in rural demand (+4%) and the gap vs urban reducing significantly, Dabur remains upbeat on mid-high single volume growth with EBITDAM at the upper end of guidance (19-19.5%). We maintain our EPS estimates and value the stock at 42x P/E on Jun-25EPS to derive a target price of INR 570. Maintain ADD.”
ICICI Securities
Add | Target price: Rs 625
“Continued recovery in rural areas (4% volume growth) is positive. Moderation in input cost drove gross margin expansion but was reinvested towards higher media spend (30% YoY). Management has guided to maintain operating margins by managing ad-spends (at 8-9%). Maintain ADD.”