Apr'25 View on Godrej Consumer Products Ltd

Godrej Consumer Products is engaged in a fast moving consumer goods Company, manufacturing and marketing Household and Personal Care products. The Stock is on way to • GCPL’s Q2 was a washout quarter. • Weak Household Insecticide season & acute margin pressure in soaps in India. • We expect earnings to grow by 22.0% in FY26E & grow by 14.3% in FY27E. • Stock is currently trading at valuation of 42.2 P/E FY27E EPS. • We cut FY2025-27E EPS by 3-6% and revise FV to Rs1,300 (Rs1,365 earlier). Q3FY25 Earnings Update: Positives: • Consolidated revenues grew 3% yoy (+2% in constant currency) to Rs37.7 bn. • LATAM continues to perform well with volume growth >25%. • Management expects some improvement in volume/value growth in Q4. • We continue to like the name and will focus on the progress of RNF LV Negatives: • Consol. Gross Margins contracted 175/145 bps yoy/qoq to 54.1% (KIE: 54.3%). • Margins to remain under pressure in near term.