Dabur India Ltd. share price target

We recently downgraded Dabur to REDUCE, given its weak execution. Dabur, in its Q4FY25 business update, noted a mid-single-digit decline in the domestic business, which is a key business concern in our view.

With an upside potential of 15% from the CMP, we maintain our BUY rating on the stock.

Competitive intensity has increased in the domestic business and Dabur is doing retailer discounts to maintain market share

DABUR issued a 3QFY25 business update. Compared to consensus, we estimate a 1% sales miss and 2% operating income miss

Sales were in line with consensus and our estimates. EBITDA was 4% below consensus and 1% above our estimates

With an upside potential of 10% from the CMP, we maintain our BUY rating on the stock.

Dabur’s 2QFY25 performance was largely in line with our estimate. Consolidated revenue declined 5% YoY (in line) primarily due to a temporary adjustment in General Trade (GT) inventory because of the growth in emerging channels.

Dabur India (DABUR), in its 2QFY25 preview update, highlighted the impact of heavy rains and floods in parts of the country on out-of-home consumption, particularly for
beverages.

Sales and EBITDA miss on 2QFY25. Estimated sales miss of 11% and EBITDA miss of 25%

With an upside potential of 11% from the CMP, we maintain our BUY rating on the stock.

1QFY25 underlying result was broadly in line with consensus with in-line sales but 1% lower EBITDA and EPS

Dabur’s 1QFY25 performance was largely in line with our estimates. Consolidated revenue increased 7% YoY (in line), while constant currency (cc) growth was 10%.

Dabur India (Dabur) to post mid to high single-digit revenue growth in Q1FY2025 with domestic volume growth of mid-single digits.

Dabur remains one of our preferred picks in the Consumer Goods sector, given
its diversified portfolio and better execution. The company’s thrust on rural
remains firm, with distribution expansion continuing to see better growth.

Amid a muted demand setting, Dabur’s thrust on enhancing its distribution has
been rewarding, with 95% of the portfolio seeing market share gains and better
growth in Rural (~8% vs ~4% growth in Urban).

Recommendation: With an upside potential of 18% from the CMP, we maintain our BUY rating on the stock.

Dabur’s 4QFY24 revenue growth was largely in line, but EBITDA was above
our estimate. Consolidated revenue increased 5% YoY (in line) and 7% YoY
in constant currency (cc) terms. For the India business, volume grew 4% YoY
(organic growth at ~3% YoY). International business grew 12% YoY in cc.