GCPL gains after healthy Q3 earnings

Capital Market, Business Standard, 05 February 2015

Godrej Consumer Products rose 3.04% to Rs 1,057.50 at 13:20 IST on BSE after consolidated net profit rose 34.63% to Rs 263.57 crore on 12.41% rise in total income to Rs 2247.78 crore in Q3 December 2014 over Q3 December 2013.

The Q3 result was announced during market hours today, 5 February 2015.

Meanwhile, the BSE Sensex was up 233.05 points, or 0.81%, to 29,116.16.

On BSE, so far 31,956 shares were traded in the counter, compared with an average volume of 44,755 shares in the past one quarter.

The stock hit a high of Rs 1,078.75 and a low of Rs 1,026 so far during the day. The stock hit a record high of Rs 1,134.40 on 19 January 2015. The stock hit a 52-week low of Rs 701 on 14 March 2014.

The stock had outperformed the market over the past one month till 4 February 2015, rising 5.81% compared with 3.57% rise in the Sensex. The scrip had also outperformed the market in past one quarter, gaining 7.54% as against Sensex's 3.67% rise.

The large-cap FMCG company has equity capital of Rs 34.04 crore. Face value per share is Re 1.

Godrej Consumer Products said India business grew by 12%, nearly 1.6 times of the overall household and personal care sector (HPC) growth. International business grew by 20% on an organic constant currency basis. Consolidated organic constant currency earnings before interest, taxes, depreciation and amortization (EBITDA) increased by 28%, driven by a strong growth of 18% in the India business and 43% growth in EBITDA in the international business. GCPL continued to gain market share across its core categories across geographies. Organic constant currency EBITDA excludes, Darling trademarks licensing fees and Ghana profitability aggregating to Rs 9 crore.

The board has declared an interim dividend of 100% (Rs 1 per share).

Commenting on the financial performance of Q3 December 2014, Mr. Adi Godrej, Chairman, Godrej Group, said: After a few quarters of sluggish growth, consumer demand in India started to show early signs of a recovery in Q3 December 2014. Organic constant currency operating earnings growth was even stronger at 28%, led by prudent cost management, benign raw material costs and our efforts to effectively leverage our brand platforms.

We are beginning to see improved consumer sentiment on the ground and are hopeful that this will translate into better consumer demand in the quarters ahead. With our relentless focus on innovation, we are in a good position to capitalise on the uptick in demand and growth. We are becoming operationally more efficient, while investing for the longer term. We expect growth in the second half of this fiscal year should be better than the first half. Consequently, our intent is to deliver a stronger performance overall this year, compared to the previous year he added.