Procter & Gamble Hygiene & Healthcare Ltd. share price target

PGHH’s strategic pillars that drive growth in the Personal and Healthcare categories are intact. The company holds a dominant ~50% market share in both the Feminine Hygiene and Healthcare categories.

P&G Hygiene and Healthcare (PGHH) delivered flat sales YoY at INR11.3b in 1QFY25 (est. INR12.4b) (FY ending June). Last three-year CAGR was 3% for the quarter and FY24 growth was 7.5%.

During the analyst meet, the management highlighted potential for double-digit sales growth, particularly in the feminine hygiene segment, in which per-capita spending is currently only one-sixth of that in China.

P&G Hygiene and Healthcare (PGHH) delivered sales growth of 10% in 4QFY24 (FY ending June), in line with our expectation. This growth was led by product-price mix, premiumization, and growth in the feminine hygiene category.

P&G Hygiene and Healthcare (PGHH) delivered healthy sales growth of 13.5%
in 3QFY24 (FY ending June), which was better than our expectation.

Feminine Hygiene and Healthcare segments report strong growth: PGHH continued to strengthen its brand fundamentals with innovation, product launches, distribution expansion, and superior communication and execution. Sales grew 19.1% YoY in FY21, led by the Feminine Hygiene (66% of sales; up 16.7% YoY) and Healthcare (33.1% of sales; up 24.1% YoY) segments. The company does not share segmental data as a part of its quarterly results. Ramping up category development: Since 1995, the Whisper school program has educated more than 25m girls across India on menstrual hygiene. PGHH...

with 19.1% sales growth this is the second year in the preceding three years that it has reported topline growth of over 19%. Thus, after losing momentum in the three years between FY16 and FY18, after the CEO change, the company seems to be back at the 1920% topline CAGR trajectory seen over FY0815. For a non-discretionary company, this is very strong topline momentum. With only ~20% penetration in feminine hygiene products (~67% of PGHH FY20 sales), coupled with dominant market...

with 19.1% sales growth this is the second year in the preceding three years that it has reported topline growth of over 19%. Thus, after losing momentum in the three years between FY16 and FY18, after the CEO change, the company seems to be back at the 1920% topline CAGR trajectory seen over FY0815. For a non-discretionary company, this is very strong topline momentum. With only ~20% penetration in feminine hygiene products (~67% of PGHH FY20 sales), coupled with dominant market...

P&G; Hygiene & Health Care's (PGHH) 3QFY21 sales growth, while healthy at 15.8% YoY, was lower than our expectations, considering: a) the strong momentum in recent quarters; and b) a favorable base, with a 6.2% sales decline in 3QFY20 (June year-ending company). There was a steep increase of 73% YoY in advertising spends, translating to ad spends coming in at 17.1% of sales in 3QFY21, much higher than the usual quarterly levels of 9-12% of sales. With gross margin actually above expectations (up 20bp YoY v/s our expectation of a 160bp YoY decline), high...

P&G; Hygiene and Healthcare (PGHH) reported a surprisingly strong 18.5% sales growth in 1QFY21 (June year-end) in a difficult operating environment. Management's statement in the press release was also encouraging. The press release stated that growth was driven by the Feminine Hygiene segment (67% of FY20 sales), which grew in double-digits (in our view over 20%) compared to the Healthcare segment, which grew in high single-digits. After ~25% growth in the Feminine Hygiene segment in FY19 (and ~20% overall sales growth), this segment had reported flattish growth in FY20 as...

(%) Margins (%) P&G; Hygiene and Healthcare (PGHH) reported flat sales in 4QFY20 (June year-end), which came as a pleasant surprise given the lockdown-related disruptions seen during the quarter. Operating margins also bucked the trend of very steep decline in margins in 4Q v/s the preceding three quarters, something that was witnessed in FY18 and FY19. Accordingly, significant EBITDA and PAT beat was reported v/s expectations. While the structural opportunity remains attractive in both the Feminine Hygiene and Healthcare segments, valuations are fair at 51.8x June FY22 EPS. Ad spends declined 41.5% YoY to INR411m, employee expenses grew 43.6% YoY to INR381m, whereas other expenses were flat YoY at INR2.1b. As a percentage of sales, ad spends declined by 450bp YoY to 6.5%, employee costs rose by 180bp YoY to 6%, and other expenses were down by 30bp YoY to 33.4%. This led to a FY20 sales/EBITDA/PAT grew by +1.

23 October 2019 While P&G; Hygiene and Healthcare (P&GHH;)s operations in 3QFY20 were affected by the COVID-19-led lockdown, its ability to arrest decline in profitability is encouraging. We believe the companys portfolio is highly resilient and would bounce back once normalcy returns. Long-term prospects remain attractive on account of strong moats. INR7.1b), with EBITDA decreasing 3.6% YoY to INR1.4b (est. INR1.4b) and PBT coming in flat YoY at INR1.4b (est.

20 November 2019 PGHH has maintained its focus on strengthening the brand fundamentals through strategic moves such as innovation, product launches, distribution expansion, and superior communication/execution. Sales increased 20% YoY in FY19, primarily led by the feminine hygiene segment (+24.4% YoY; 70% of sales). Healthcare segment too exhibited a healthy performance (+11.2% YoY), driven by 14% YoY growth in Vicks VapoRub. Under the Whisper brand, PGHH launched Whisper Choice Aloe Vera to tap into the rising fervor for naturals among the Indian consumers. Whisper school program created awareness among five million girls across 40,000 schools about the importance of menstrual hygiene in FY19. Notably, this program has reached 25 million girls since 1995. In Healthcare, the higher penetration for Rubs, new launches (premium lozenge Vicks 3-in-1), distribution expansion and strong advertising helped the segment to grow in double digits in FY19. Interestingly, ad spends were even higher at 12.3% (+180bp YoY) in 1QFY20.

1QFY20 (ending Jun'19) net sales grew 7.6% YoY to INR8.5b (v/s est. 9.2b). However, EBITDA declined 13.1% YoY to INR1.8b (v/s est. INR2.1b). PBT declined 12.2% YoY to INR1.8b (v/s est. INR2.1b). Adj. PAT was flat YoY at INR1.4b (v/s est. INR1.4b) due to lower corporate taxes. Feminine care business registered strong double-digit growth, while the healthcare business (likely to have been a laggard in 1QFY20) still reportedly grew faster than the market. Gross margins expanded 20bp YoY to 60.4% (v/s est. 59.0%). EBITDA...