P&G Hygiene: Margins advantage - Views on News from Equitymaster

Helping You Build Wealth With Honest Research
Since 1996. Try Now

  • MyStocks

MEMBER'S LOGINX

     
Login Failure
   
     
   
     
 
 
 
(Please do not use this option on a public machine)
 
     
 
 
 
  Sign Up | Forgot Password?  

P&G Hygiene: Margins advantage

Feb 2, 2001

P&G Hygiene & Healthcare Limited has declared a 28% jump in its bottomline in its second quarter ended December 31, 2001. However, P&G could not escape the slow down in its turnover growth. The company's turnover growth was a minor 1% during the quarter.

(Rs m) 2QFY00 2QFY01 Change 1HFY00 1HFY01 Change
Sales Turnover 1,341 1,359 1.3% 2,534 2,560 1.0%
Other Income 10 12 15.0% 12 26 116.9%
Total expenditure 1,024 980 -4.2% 1,972 1,900 -3.6%
Operating Profit (EBDIT) 318 379 19.2% 562 660 17.4%
Operating Profit Margin (%) 23.7% 27.9%   22.2% 25.8%  
Interest 17 0 - 29 1 -95.1%
Depreciation 56 70 24.5% 114 143 25.6%
Profit before Tax 254 320 26.0% 431 541 25.4%
Tax 47 56 18.2% 75 91 21.6%
Profit after Tax/(Loss) 207 264 27.7% 356 450 26.2%
Net profit margin (%) 15.4% 19.4%   14.1% 17.6%  
No. of Shares (eoy) (m) 21.6 21.6   21.6 21.6  
Earnings per share*       32.9 41.6  
*(annualised)            
Current P/e ratio         16.2  

However, the company managed to put in a good performance by improving its operations. It improved its operating margins by 420 basis points by controlling expenditure. P&G also pruned its debt burden. As a result, its interest costs were zero during the quarter. The company's net margins too, improved by 400 basis points.

The company's consolidated first half performance was almost identical to the second quarter performance, indicating a consistency in P&G performance.

To lend focus to its business, P&G consciously decided to be present only in two products viz. Anti-cold (Vicks) and feminine care (Whisper). Its strategy has revolved around premium positioning of both its product categories. In a sense, the company has been focussing on margins (value) rather than volumes. But competition from products such as Dcold and Smyle has impacted the sales of Vicks cough drops.

The stock trades at a P/e multiple of 16.2 times its annualised half yearly FY01 earnings. For P&G we had projected a net profit of Rs 763 m in FY01. The company's performance in the first half indicates that it is likely to exceed those projections.


Equitymaster requests your view! Post a comment on "P&G Hygiene: Margins advantage". Click here!

  

More Views on News

P&G HYGIENE Announces Quarterly Results (3QFY20); Net Profit Up 9.5% (Quarterly Result Update)

Feb 17, 2020 | Updated on Feb 17, 2020

For the quarter ended December 2019, P&G HYGIENE has posted a net profit of Rs 1 bn (up 9.5% YoY). Sales on the other hand came in at Rs 9 bn (up 5.0% YoY). Read on for a complete analysis of P&G HYGIENE's quarterly results.

P&G HYGIENE Announces Quarterly Results (2QFY20); Net Profit Down 5.0% (Quarterly Result Update)

Nov 11, 2019 | Updated on Nov 11, 2019

For the quarter ended September 2019, P&G HYGIENE has posted a net profit of Rs 1 bn (down 5.0% YoY). Sales on the other hand came in at Rs 9 bn (up 7.6% YoY). Read on for a complete analysis of P&G HYGIENE's quarterly results.

P&G HYGIENE 2017-18 Annual Report Analysis (Annual Result Update)

Dec 31, 2018 | Updated on Dec 31, 2018

Here's an analysis of the annual report of P&G HYGIENE for 2017-18. It includes a full income statement, balance sheet and cash flow analysis of P&G HYGIENE. Also includes updates on the valuation of P&G HYGIENE.

More Views on News

Most Popular

How the 8-Year Cycle Can Help Identify Multibaggers (Fast Profits Daily)

Sep 11, 2020

This is how you can apply the greed and fear cycle in the market to pick stocks.

I Recommended this Stock over Page Industries because it's Relevant to Doubling Your Income (Profit Hunter)

Sep 7, 2020

Things are not often what they seem in the market and how you can take advantage of this.

The NASDAQ Whale Could Harm Your Portfolio (Fast Profits Daily)

Sep 7, 2020

The discovery of Softbank pushing up prices on the NASDAQ will cause volatility in the market. Stay alert!

This Could Be the Best September for Auto Stocks (Profit Hunter)

Sep 11, 2020

Here's why I think this month could be a great for auto stocks.

More

Covid-19 Proof
Multibagger Stocks

Covid19 Proof Multibaggers
Get this special report, authored by Equitymaster's top analysts now!
We will never sell or rent your email id.
Please read our Terms

P&G HYGIENE SHARE PRICE


Sep 18, 2020 03:37 PM

TRACK P&G HYGIENE

  • Track your investment in P&G HYGIENE with Equitymaster's Portfolio Tracker. Set live price alerts, get research alerts and more. Get access now...
  • Add To MyStocks

P&G HYGIENE - BAJAJ CONSUMER CARE COMPARISON

COMPARE P&G HYGIENE WITH

MARKET STATS