Emami's underperformance over the last 3 years has not been caused by competitive intensity rather its own challenges like (1) High wholesale dependence, (2) Core brands' dependence on seasonality, (3) Limited portfolio for premiumisation and (4) Pledge related disturbance. The company has made some progress in the last 2 years in diversifying its distribution from wholesale (~38% mix now vs. 52% earlier) to modern trade (9% mix now vs. 4% earlier) and direct reach (0.95mn stores vs. 0.63mn earlier). Benefits are coming at a gradual pace. Recovery in macros (rural) coupled with a favorable season can lead to a rebound in Emami's performance. We remain believers, given favorable risk-reward and high probability for a consumer business to rebound. Emamis 2Q was in-line with no negative surprises. Domestic business performance continues to be muted and own initiatives are still a WIP. Strong winter, recovery in macros and asset sales (drive lower pledged shares) are the key triggers for re-rating in the stock. Benign RM and favorable base will support 2HFY20 profit growth. We cut EPS estimates by 2% and value Emami at 30x on Sep-21E EPS, arriving at a TP of Rs 463. Maintain BUY.