Akash Jain
Dabur India is fairly valued at current valuations. We do not expect any major upside. Investors may avoid it as it has already discounted next 2 years earnings growth.
The company’s performance in Q3FY18 was satisfactory. Segments like oral care, hair oil and health supplements clocked growth of 23 percent, 16.7 percent and 19.5 percent, respectively. On the other hand, foods reported flat numbers on a very high base. International sales grew 5 percent on a constant currency (CC) basis.
It has completed acquisition of two South Africa-based companies -- D&A Cosmetics Proprietary Ltd and Atlanta Body & Health Products Proprietary Ltd. - through its subsidiary. The company had last year announced that it will acquire the two personal care products companies in South Africa for a total cash consideration of 50 million rands (about Rs 25 crore).
Dabur India said its wholly owned subsidiary Dermoviva Skin Essentials Inc has acquired 100 percent share capital of the companies. Accordingly, both the companies have become step down wholly owned subsidiary companies of Dabur India Ltd, it added. It would be interesting to see that how these acquisitions pan out in the form of new synergies added and its effect on bottomline.
Disclaimer: The author is Vice-president, Equity Research at Ajcon Global Services. The views and investment tips expressed by investment experts on moneycontrol.com are their own, and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.
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