Research Digest | May 30, 2017
GodrejCP - known for Good Knight, HIT, Cinthol, Ezee and many more, is a part of 120 year old Godrej Goup and has presence and dominance in India as well as in Emerging Countries, precisely in Indonesia, Africa, Latin America and Europe.
For its major product categories, the company is
Largest in India, Second largest in Indonesia for - Household Insecticide
Number One In india, Number One in Sub-Saharan Africa, Leading Player in Latin America for - Hair Care
Some key factors that makes GodrejCP a must have in portfolio are:
1. Fair management practices
2. Year after year stellar Annual Numbers. Revenues growing at a CAGR of 15% for last 5 years
3. Group aiming to grow revenues 10-fold in the next 10 years
4. Margin expansion going forward due to better product mix
5. Better dividend policy going forward
6. Debt reduction Plans
Most importantly, timely and successful implementation of the transformative Goods & Service Tax (GST) will spur stronger growth for the sector in the second half of fiscal year 2018. There is enormous growth potential in India and emerging markets, given the low penetration and consumption rates in Company’s core categories, Godrej Cp though 120 year old still looks young. The Company is presently trading at 9.3 times P/B of FY19E. We recommend HOLD.