Colgate-Palmolive (India) Ltd. share price target

Colgate’s Q4FY25 performance was muted owing to soft demand in urban markets and heightened competitive intensity. Standalone revenues declined by 1.8% y-o-y to Rs. 1,463 crore, missing our expectation of Rs. 1,520 crore, with toothpaste volumes flat y-o-y.

We've been long critical of Colgate India's (consistent) strategy of not investing (enough) for toothpaste category growth (our opinion), not aggressive (enough) in diversifying outside of oralcare (parent has a good HPC portfolio though), over-earning, in our opinion (operating margins at ~37% after adding back royalty).

Cautious outlook for 1H26 due to muted urban demand, expect recovery led by innovations & rural momentum post 2Q. increased promotional spending led by heightened competitive intensity. Near term outlook is cautious given that 1) urban demand continues to remain muted at mass end 2) heightened competitive landscape 3) rising promotional...

For Q3FY25, the revenue increased to 4.7% YoY (-9.7% QoQ) to INR 14,618 Mn, which missed our estimate by 3.9%. The company YoY growth, driven by toothpaste sales which showed mid-single digit volume growth.

With an upside 6% from the CMP, we maintain our HOLD rating on the stock.

In FY24 and 1HFY25, CLGT achieved revenue growth of 9% and 11%, outperforming FMCG peers (refer to Exhibits 1/2). Volume growth remained flat in FY24 but improved to 7% in 1HFY25.

Colgate’s ‘Investor Day’ showcased management effort toward driving category consumption and focus on enhancing consumer uptrade.

For Q2FY25, the revenue increased 10.1% YoY (+8.2% QoQ) to INR 16,191 Mn, which is in line with our estimates of 0.8%. The YoY growth was led by high single-digit volume.

With a downside of -2% from the CMP, we recommend a HOLD rating to the stock

We reiterate our REDUCE call on Colgate due to a high base for growth delivery ahead. The company has executed well on oral care and consistently surprised the street with its performance.

Colgate-Palmolive (India)’s (Colgate’s) Q2FY2025 numbers were mixed with revenue coming in line with expectations, while margins missed mark owing to higher advertising spends. Revenue grew by 10% y-o-y while OPM fell by 206 bps y-o-y leading to lower PAT growth at 3.9% y-o-y.

Q1FY25, CLGT reported total revenue from operations of INR 14,967 Mn (+13.1% YoY, +0.4% QoQ), which beat our estimate by 4.3%. The YoY growth was led by high single-digit volume.

we have a HOLD rating to the stock.

Colgate (CLGT) delivered a 13% YoY revenue growth to INR15b (est. INR14.4b) in 1QFY25. Volume growth spiked at a high-single digit (flattish in the previous four quarters).

For Q4FY24, CLGT reported revenue of INR 14,900 Mn (+10.3% YoY / +6.8% QoQ), about in-line with our estimates. Domestic revenue grew by 10.7% YoY.