Colgate-Palmolive India Ltd.’s shares declined more than 3 per cent on Monday, despite a largely bullish view from Jefferies. In a post-analyst meeting note, the brokerage said the company’s top-line growth is likely to accelerate, driven by volumes, premiumisation and pricing. However, it expects margins to remain range-bound.
As of 10:46 AM, the company’s share price was trading 2.34 per ent lower at ₹1,917.30 apiece, meanwhile Nifty 50 was trading 0.35 per cent lower at 24,202.95. The company’s stock hit an intraday low of 3.2 per cent at ₹1,901.70
Jefferies on Colgate
The brokerage firm noted that Colgate continues to drive category consumption through multiple initiatives across urban and rural markets, including Oral Care Health Movement, Bright Smile Bright Future (partnerships with govt and schools), and multiple online/offline campaigns. The co. is also focused on growing its core portfolio through product technology, better packaging, consumer communication, and improved availability.
It added that, “Premiumisation remains a key growth driver for Colgate, with management planning to double down on it. The strategy is focused on three key brands: Colgate Total, Colgate Visible White (VW) and Colgate Periogard”
Jefferies noted that the company’s premium portfolio is growing 6 times faster than the overall portfolio, with revenue share now at 2.5 times versus CY21. The brokerage highlighted that the company believes premiumisation is expanding beyond metros into rural markets as well. Colgate is also launching a new format, toothpaste pump as part of its premiumisation strategy.
Jefferies listed four key points
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Focus remains on growth over profitability. -
The company will continue investing in driving consumption and premiumisation. -
Topline growth is expected to improve, led by a balance of volume growth (focus on core; low base to also help), better mix through premiumisation, and pricing. -
GMs are expected to remain range-bound, while A&P is expected to remain elevated in the near term.
Colgate Palmolive India Q1FY27
Colgate-Palmolive India reported 7 per cent rise in net profit at ₹343.08 crore for June quarter FY27 helped by volume growth from toothpaste portfolio and expansion in margins. In the year-ago period, the profit was ₹320.62 crore.
Sales were up 12 per cent to ₹1,590.56 crore in the June quarter of FY27. Total expenses were up 13.8 per cent to ₹1,160.57 crore. Total income, including other income, was ₹1,626.10 crore, up 12 per cent year-on-year.
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