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With An Expanding FMCG Business In International And Domestic Markets, Buy This Stock For Good Returns
Brokerage firm Nirmal Bang recommended buying the stocks of Marico Ltd., for a target price of Rs. 580. Marico has a portfolio of brands such as Parachute, Saffola, Saffola FITTIFY Gourmet, Coco Soul, Parachute Advansed, Hair & Care, Nihar Naturals, Livon, Set Wet, Set Wet Studio X, Veggie Clean, Kaya Youth, Travel Protect, House Protect, Mediker, Revive and Beardo.
Target Price
The Current Market Price (CMP) of Marico Ltd. is Rs. 515. The brokerage firm, Nirmal Bang has estimated a Target Price for the stock at Rs. 580. Hence the stock is expected to give a 12.7% return, within 1 year.
| Stock Outlook | |
|---|---|
| Current Market Price (CMP) | Rs. 515 |
| Target Price | Rs. 580 |
| 1 Year returns | 12.70% |
Company performance
All international businesses of Marico Ltd., docketed positively, leading to high-teen constant currency (cc) growth on a healthy base of 8%. MRCO's domestic business (~77% of overall revenue) has seen revenue growth in double digits, with flat volume growth. The company's net revenue in FY 21 stood at Rs. 80,480mn. Nirmal Bang said, "Changes to our model have led to downward revision of 3%/2.5%/2.9% in FY22E/FY23E/FY24E estimates mainly due to slightly lower volume growth as well margin assumptions." Their Saffola Foods experienced a 20% growth and remained on course to clock Rs. 5bn revenue in FY22.
Comments by Nirmal Bang
Maintaining a buy rating, Nirmal Bang commented, "Rising mobility led to pent-up demand for discretionary goods, services and out-of-home consumption. MRCO's domestic business (~77% of topline) thus recorded double-digit revenue growth, with flat volume (although volume growth was close to MRCO's medium-term aspiration)." Additionally, "Distribution expansion in India, especially in rural areas, through direct reach and leveraging alternate distribution channels in urban centers" is a key side.
About the company
Marico Limited is one of India's leading consumer goods companies operating in the health, beauty and wellness space. With its headquarters in Mumbai, Marico is present in over 25 countries across emerging markets of Asia and Africa. The international consumer products portfolio contributes to about 23% of the Group's revenue.
Disclaimer
The above stock was picked from the brokerage report of Nirmal Bang. Investing in equities poses a risk of financial losses. Investors must therefore exercise due caution. Greynium Information Technologies, the author, and the brokerage house are not liable for any losses caused as a result of decisions based on the article.
