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market | IST

Moneycontrol Pro: Emami in focus, here’s why

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In a few ideas for profit from Moneycontrol Pro, Nandish Shah of Moneycontrol.Com spoke about a stock that he is tracking closely, Emami.

In a few ideas for profit from Moneycontrol Pro, Nandish Shah of Moneycontrol.Com spoke about a stock that he is tracking closely, Emami.
Emami power brands like Navratna oil, Boroplus cream, Zandu balm and Fair & Handsome contribute nearly 75-80 percent of the revenues.
Improved mobility and higher spend on discretionary products led to double-digit growth in male grooming, Kesh King and Boroplus segment; while healthcare grew by 5 percent.
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Operating margin performance was better than peers as Emami was able to pass on the full increase in prices.
In second half of FY22, Emami expects margin pressure of around 80-100 basis points (bps) year-on-year (YoY) on the back of continued surge in raw material prices, coupled by higher investment behind brands.
New product launches will continue to drive growth and remain the key monitorable for Emami.
The contribution from new product launches is around 2.5-3 percent currently, which the company plans to target around mid-single digit going forward.
The company plans to add around 8,000 towns and villages by FY22 under project Khoj, which will lead to its incremental presence of more than 50,000 retail outlets.
The stock is currently trading at a P/E multiple of 30 times FY23 earnings. Investors with a long-term view can accumulate and add it on decline.
Watch the accompanying video for more details.
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