Colgate Palmolive (India) is set to report its first-quarter results today. Alongside all the other fast-moving consumer goods (FMCG) stocks, which have been under pressure over the last few quarters, Colgate has underperformed, down 16 percent in 2019 so far.
The big concern for Colgate is the loss of market share. In the oral care entry-level space, there is a fair amount of competitive pressures and the company, from a peak of close to around 58-59 percent market share, has now fallen to 52 percent.Here's what to expect from the company today:
- Total income growth is seen higher by about 5.5 percent, at Rs 1,100 crore as a result of which there would be a pedestrian growth in the company’s EBITDA as well – 3.5 percent growth at around Rs 300 crore.
- Margins are expected to be lower by 50 basis points (bps) and the reported net profit would be lower by about 10.5 percent at Rs 169 crore.
- Volume growth is seen at around 4 percent. The company has taken a blended price hike of around 2-2.5 percent but that will not reflect in the revenue because of the heavy discounting and heavy promotions that the company has done.